Following our first recommendation on SXC Health Solutions Corp. (Dec. 6, 2008, $9.68 – adjusted for two-for-one split), the stock started a sharp rise above its rising 40-week moving average and reached $62.64 (A) for a 547-per-cent appreciation at that time. Subsequently, SXC declined below its 40wMA (B) and settled in a trading range between $45 and $62 (dashed lines). Recent price action to $66.37 (C) signalled the breakout from the large range and the start of a new upleg. Only a decline below about $56 would be negative.
Point & Figure measurements provide initial targets of $74 and $84.
Monica Rizk is the senior technical analyst for Phases & Cycles Inc. ( www.phases-cycles.com). Ron Meisels is a contributor to the www. www.NA-marketletter.com web site. They may hold shares in companies profiled. Please see the site for a glossary.
Chart source: www.decisionplus.com