From the high of $47.89 in October, 2007 (A), CCL Industries Inc. declined below a falling trend line (dotted line) and below its 40-week moving average to $19.84 in March, 2009 (B). Subsequently, the stock settled into a horizontal trading range mostly between $20 and $25 and then rallied and settled into another horizontal trading range mostly between $25 and $30 (dashed lines). This price action produced a bullish technical pattern known as a Duplex Horizontal. A rise above $31-$32 would confirm the breakout and signal higher targets. Only a decline below $25-$26 would reverse the positive status of this stock.
Point & Figure measurements provide initial targets of $39 and $44 (32-per-cent and 50-per-cent appreciation potentials, respectively, from current levels). The large base supports higher targets.
Ron Meisels is a contributor to the www.NA-marketletter.com website. Monica Rizk is the senior Technical Analyst for Phases & Cycles Inc. They may hold shares in companies profiled. Please see the site for a glossary.
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