Clearing a Channel to Profits – Great Lakes Dredge & Dock

• Posted by Greg Harmon
• on November 14th, 2012

Great Lakes Dredge & Dock, $GLDD, may not trade as many shares as some more well known stocks, but this small cap stock shows signs of a major long term technical breakout warranting a closer look. The monthly chart below is a thing of beauty to a technician. The price is approaching the top of the 4 year ascending triangle at 8.30 with a bullish and rising Relative Strength Index

Great Lakes Dredge & Dock, $GLDD, Monthly

(RSI), a positive and growing Moving Average Convergence Divergence indicator (MACD), and accumulation in the stock. A break over the top of the triangle has resistance at 9.69, the high from 2007 and then a target on the pattern break to 14.33. Sounds great huh, just need that break out higher. So what does the short term picture look like. It is pulling back with support at 7.80. That happens to be a minor Fibonacci level on the monthly chart, the 76.4% retracement. A hold there and reversal could trigger an early entry into the long term trade, against the level as a stop, since it would carry a Measured Move higher to 9.20.

Great Lakes Dredge & Dock, $GLDD, Daily

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