Linamar Corp. declined from $89.42 to $42.24 (A-B) below a descending trend-line (dotted line) and below its falling 40-week Moving Average (40wMA) for over a year. The stock then rallied above this trend-line (C) and above its 40wMA to signal renewed investor interest. It stayed in a horizontal trading range mostly between $55 and $64 for about seven months (dashed lines). The recent price action above the top of this range signalled the breakout (D). A minor correction may occur toward $64-65, but only a sustained decline below $60-61 would be negative. Point & Figure measurements provide targets of $74 and $79. Higher targets are visible.
Monica Rizk is the senior Technical Analyst and Ron Meisels is the president of Phases & Cycles Inc. (www.phases-cycles.com). And he tweets at @Ronsbriefs. They may hold shares in companies profiled.
Chart source: www.decisionplus.com
Monica Rizk
Ron Meisels