Analysis of Sam Engineering stock chart.
Today Sam Engineering broke out of a pennant pattern. This is a continuation pattern and there may be more potential upside for the stock.
Sam Engineering is above the rising 20 MA, 50 MA and also the 200 MA. This is a picture of strength in technical analysis. Today it broke out of a pennant pattern. The pattern is perfect as there was declining volume during the consolidation period.
The buy point is the breakout point but of course you might be wondering how high it can go. One can take the height of the pole which is the last move up before the consolidation and project it upwards from the tip of the pennant to get a possible target. Go do some homework.
Target may or may not be met but if there is a correction then the top of the pennant will be a support area. A good pennant breakout will not see the stock dropping back to the tip of the pennant. It rarely happens in genuine breakout.
The 60 min chart shows us how the breakout occurred. Watch the 60 min 20 MA. It will guide you to show you when the stock might reverse. As long as the stock is above the rising 60 min 20 MA then there is a big possibility that it will meet the projected target.
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