Grab a Bud and Enjoy the Holiday Week
- Posted by Greg Harmon
- on December 27th, 2012
Anheuser-Busch InBev, $BUD, has responded very well technically since breaking out of the consolidation range in September. The Shooting Star September 6th squeezing out of the tight Bollinger bands confirmed a reversal lower the next day. It found support at the 20 day Simple Moving Average (SMA) which is the center line of the Bollinger bands and moved higher, like it had the two previous touches there. The Shooting Star October 5th, also after a move higher out of a Bollinger band squeeze, was confirmed lower and this time found the 100 day SMA as support,
where it found support the last time the Relative Strength Index (RSI) had moved into bearish territory in June. Now it is consolidating in a box with the Bollinger bands as tight as they have been in years. This is setting up to squeeze out in one direction or the other. The bullish RSI and the proximity of the 50 day SMA to the 100 day SMA (like the end of June) bode well for a break to the upside. The target on a Measured Move higher takes it to 94.50 on a break over 90.
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Gregory W. Harmon CMT, CFA, has traded in the Securities markets since 1986. He has held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)
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