NEW YORK ( TheStreet) -- Shares of snack food giant Mondelez International (MDLZ) - Get Mondelez International, Inc. Class A (MDLZ) Report were up more than 3% in Friday's session, a sweet move than could get even sweeter, with the stock looking prepared to break above key resistance.
A triangle pattern formed on the weekly chart as the stock began consolidating in the last half of 2014 into the first half of this year. In May, it broke above pattern resistance, but after a sharp three-month rally, a high wave shooting star candle marked the end of the run. It dropped back down to the triangle resistance-turned-support level, and just as it had been strong resistance, it was also solid support, allowing the stock to bounce and form a large hammer candle in the process.
Hammer candles are particularly significant when they form at former resistance levels, retesting a continuation pattern such as the triangle pattern, and often mark the starting point of another phase in an uptrend. Mondelez did continue to move higher, and last week a second large hammer candle formed just below the 50-day moving average on strong volume.
The 50-day moving average is now resistance and acting as the upper end of a one month horizontal channel on the daily chart.
Stochastics have moved back above their centerline, reflecting positive price momentum, and the money flow index, a volume-weighted relative strength measure, is above its 21-period signal average and centerline. Friday's close was just slightly above the 50-day average, but a confirmed breakout would require another upper candle close above resistance.
Disclosure: This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.