We're seeing the exact same trading setup in shares of
Rockwood Holdings (
ROC) right now, only stretched out much longer term. ROC has actually spent most of 2013 stuck consolidating in an ascending triangle pattern of its own, with resistance in place at $68. Despite some attempts at pushing through that price level back in late September, ROC is still in the pattern.
That makes $68 the price level to watch in November.
>>5 Rocket Stocks to Buy in November
, measured by 14-day RSI, adds some extra evidence that this latest bounce in ROC will hold. The 30 level in RSI has acted as a momentum floor over the course of this setup, and it's getting touched again. Expect a move through 70 on that momentum gauge to precede a breakout.
If you decide to be a buyer when that happens, I'd recommend keeping a stop on the other side of the
200-day moving average