Welcome to the third edition of the Weekly Breakout Candidates for which stocks were selected from the NYSE and NASDAQ markets.
I will soon provide a complete update on all of our stock market bullish and bearish calls. In the mean time you are invited to follow-up on the regular updates posted via the Charts And Trends Twitter feed.
Similarly to previous editions we are essentially looking for an array of positive technical indications such as a positive or rising relative strength, significant volumes of exchange, a positive long term trend (as identified by the 30-week moving average), and a potential or realized breakout on the price chart.
This week’s selection does not provide for potential super winners but comprises a few configurations with interesting potential breakout patterns. As for previous breakout scenarios readers should refrain from anticipating the proposed moves but intervene only when the breakouts get realized, ideally with entry orders:
- OLIN CORP.
- MARCUS & MILLICHAP INC.
- INTERNATIONAL FLAVORS & FRAGRANCES
Olin Corp. (NYSE: OLN) is an American manufacturer of ammunition, chlorine, and sodium hydroxide. There is a potential breakout situation that can be exploited should the price extract itself from the contracting triangle pattern on the weekly price chart to target the previous price peak as indicated on the the yearly price chart.
– Buy the breakout when the price moves to $34 (highlighted green area).
– Place the stop-loss slightly below $28 (red line segment).
– Target previous price peak at ca. $46 (end of blue arrow).
– Profit/Loss ratio: ca. 18/6 ~ 3:1.
MARCUS & MILLICHAP
Marcus & Millichap Inc. (NYSE: MMI) is a company with commercial real estate activities. The stock price appears to be closed to a resolution of the contracting pattern. A break above the descending red resistance line should unleash a bull potential until the $39 area corresponding to the previously broken support area.
– Buy the breakout when the price moves to $28 (start of blue arrow).
– Place the stop-loss slightly below $24.5 (red line segment).
– Target previously broken support around $39.
– Profit/Loss ratio: ca. 11/3.5 > 3:1.
INTERNATIONAL FLAVORS & FRAGRANCES
International Flavors & Fragrances (NYSE: IFF) is a major producer of flavors and fragrances which it markets globally. This stock is more of a momentum play than a normal breakout candidate as the stock price is hitting repeatedly the last overhead resistance line. Should a break happen here there would be no limit for further upside since the price would enter into virgin territory.
– Buy the breakout when the price reaches $140 (start of blue arrow).
– Place the stop-loss below the moving average, i.e. slightly below $127 (red line segment).
– No price target can yet be defined.