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Symmetrical Continuation Triangle in Green Mountain Coffee Roasters (GMCR)

Find out the key signs of a symmetrical continuation triangle


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Green Mountain Coffee Roasters
(GMCR) is showing bullish signs leading up to earnings next week on August 7 after the close. Why? Well aside from the reiterated “Outperform” rating from Zacks yesterday, the Trending123 Pattern Scan has identified a symmetrical continuation triangle that has developed over the past 29 days.

The price has broken upward out of a consolidation period, suggesting a continuation of the uptrend that’s been percolating since the beginning of 2013. A symmetrical continuation triangle typically shows two converging trendlines as prices reach lower highs and higher lows. Volume diminishes as the price swings back and forth between an increasingly narrow range reflecting uncertainty in the market direction. Then well before the triangle reaches its apex, the price breaks out above the upper trendline with a noticeable increase in volume, confirming the pattern as a continuation of the prior uptrend.

Another sign confirming this pattern is a price move above a key resistance level like the 200-day moving average. This appears to be occurring now, and provides extra confirmation that the trend is poised to continue upward.

Target Price: $89.00 – $92.00

Stop: $68.22

InvestorPlace advisor John Lansing tracks the charts all day and offers expert technical analysis in his day trading, options and trading services: Power Trading at the OpenParabolic Options and Trending123.  Trending123 members receive access to the Trending123 Pattern Scan powered by Recognia free as part of their membership.

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