Using Trading Central’s “Technical Insight” screener I screened for U.S equities that have listed optionsavailable and haveconfirmed a bullish classic technical pattern with a possible upward price move of at least 15%. Finally we scanned for stocks with a rating between 5 and 10 using Trading Central’s new Quantamental rating method. The TCQuantamentalRating®is a new proprietary analytic developed by Trading Central which covers over 50,000 stocks worldwide. This metric rates stocks on a scale of one to ten with ten being the most bullish and one being the most bearish.TC Quantamental rating uses a combination of valuation, growth, Quality, Price momentum, and Income as key metrics when rating a company.
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What we found
Diamondback Energy (FANG: NASDAQ) confirmed an upside breakout with a target price in the range of $103 to $106. The company has a total TC Quantamental rating of 6.7/10 with a 9.3/10 momentum rank and Value rank of 7.8.
The price broke upward out of a trading range suggesting we’re entering a new uptrend.
The Upside Breakout pattern represents a trading range in which prices move sideways between two parallel horizontal lines. It’s often a pause or congestion area within an existing trend though sometimes the breakout results in a reversal to the prior trend. Either way, an upside breakout through the upper resistance line signals an end to the consolidation period and the start of an uptrend. Cracker Barrel Old Country Store Inc. (CBRL: NASDAQ) confirmed a Bullish Symmetrical Continuation Triangle with a price target in the range of $189 to $195. The company has a total TC Quantamental rating of 5.9/10 with the highest rating of 9/10 for momentum and 7.7/10 for quality.
The price has broken upward out of a consolidation period, suggesting a continuation of the prior uptrend.
A Symmetrical Continuation Triangle (Bullish) 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.
United States Steel Corp (X: NYSE) has also confirmed a Bullish Symmetrical Continuation Triangle. The company has a total TC Quantamental rating of 5.1/10 and a momentum rating of 8.5/10.
Adobe Inc. (ADBE: NASDAQ) confirmed a Bullish Continuation Diamond with a price target range of $603 to $624. The company has a total TC Quantamental rating of 6.7/10, 7/10 for value, 8.1/10 quality rated and 7.8/10 for momentum.
The price has broken upward out of a consolidation period, suggesting a continuation of the prior uptrend.
The pattern begins during a downtrend as prices create higher highs and lower lows in a broadening pattern. Then the trading range gradually narrows after the highs peak and the lows start trending upward. When the price breaks upward out of the diamonds boundary lines, it marks the resumption of the prior uptrend.
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Chart Sources: TradingCentral Technical Insight
The investment ideas presented here are for information only. They do not constitute advice or a recommendation by Trading Central in respect of the investment in financial instruments. Investors should conduct further research before investing.
Gary Christie is head of North American research at Trading Central in Ottawa.
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