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What the Charts Say

Bullish on Dow Chemical Add to ...

Dow Chemical Co. declined from $42.23 (U.S.) to $20.61 in 2011 (A-B), had a recovery rally to $36 (C) and then settled in a trading range mostly between $28 and $36. This price action produced a bullish technical pattern known as a V-Extended formation (dotted lines). The recent rise to $41.08 signalled the breakout from this formation and the start of a new major up-leg. Dow Chemical is currently overbought and a better buying opportunity may occur near $36-$37, but only a decline below the recent trading range near $34-$35 would be negative.

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Point & Figure measurements provide targets of $43 and $49. Higher targets are visible.

Monica Rizk is the senior technical analyst for Phases & Cycles Inc. (www.phases-cycles.com). Ron Meisels is a contributor to the www.NA-marketletter.com website and Tweets at @Ronsbriefs. They may hold shares in companies profiled. Please see the site for a glossary.

Follow us on Twitter: @Monicarizk1, @RonsBriefs

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