FireEye declined from $55.33 in June, 2015, to $11.35 in February, 2016, (not shown) and then settled in a multiyear trading range mostly between $10 and $20 (dashed lines). Last December the stock had a major breakout from this range and rose to $25.53, which signalled the start of a new up-trend toward higher targets (A).
The recent decline toward the top of its trading range and toward its 40-week Moving Average (40wMA) provides an excellent entry point. Only a sustained decline below $17-18 would be negative.
Behaviour indicators including the rising 40wMA and the rising trend-line (solid line) confirm the bullish status. A sustained rise above $21.50-22.00 would suggest the resumption of the up-trend.
Point & Figure measurements provide targets of $26 and $28. 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
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