Monday, October 16, 2006

Bollinger Squeeze Watch List

I've been downloading historical price quotes from Yahoo and started writing my own scans for technical indicators. The first one that I'm trying, because it's very easy, is the Bollinger band squeeze. Here's what I found for this week's watch list:

ADBE. Uptrend. One-month flag. Friday was an upside breakout of both the flag and upper Bollinger band with strong volume. Successful completion of the flag means making a new all-time (20-year) high.

DST. One-month flag off a minor uptrend. No breakout yet, but Bollinger bands are very tight - less than 3% from upper to lower band. The flag suggests an upside breakout, which would make a new 5-year high.

EFX. Screaming flag pattern. Flagpole broke resistance of about 33.25. So we'd expect a 10% move to the upside after a breakout, though a successful move would also require breaking the 38.50 resistance level. Coincidentally, FIC also has a Bollinger squeeze.

GT. Uptrend. One-month flag. No breakout yet. An upside breakout of the current flag would also break a key resistance level at 15. Flag predicts a 15-20% move after breakout.

K. Significant weakness. Broken neckline on a H&S top. Broken 5-month support trendline on price and RSI. Friday's trading gapped down on open and, by the close, broke the lower Bollinger band and the 100-day EMA on 150% volume.

PHG. Uptrend. One-month flag. No breakout yet. 35 is a key resistance area, and the flag is centered around it. An upside breakout would make a new 5-year high.

TROW. Uptrend. One-month flag. An upside breakout would make a new all time (20-year) high. But warning: MACD line and histogram both show bearish divergence, and RSI has been downtrending during the flag. Must wait for breakout.


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