Tower Group's Base Shifting, Volume Sturdy (Investor's Business Daily)
Wed, 29 Apr 2009 22:43:07 Etc/GM
The insurance company had been forming a double-bottom base. That's not so applicable anymore, since the stock has drifted sideways instead of trying for new highs.
But it's still a base in the works.
Tower Group broke out of a base in early January but quickly failed. Shares found support at the 10-week moving average and rallied to a high of 27.65.
This high would have been the basis for a double bottom's buy point. That level is noteworthy because of a longer trend of resistance around that price.
Since hitting its low of 19.70, the stock has regained its 10-week moving average. Once it did that, trading tightened and the stock continually found support at its 50-day moving average.
This stretch of tighter trading is not a three-weeks-tight pattern because the weeks did not finish within 1% of the previous close. More importantly, such patterns are found after stocks break out, as follow-on buy opportunities.
Overall the base has four net weeks of accumulation.
Lately, volume has dried up as the stock climbs. Its Relative Strength line has also slipped a bit.
source: http://biz.yahoo.com/ibd/090429/basereader.html?.v=1