Price Action Reflects Favorable Fundamentals Of Albemarle

2019년 7월 3일

*Bottoming price pattern indicates bearishness has ended.
*The bullish Pivot Stack shows an upward bias.
*A new Monthly Pivot Range provides a higher price level of support.

In addition to the positive fundamental news that has come out recently on Albermarle, the price shows convincing evidence that the bottom is in for the time being. The bounce off the June 3rd low of 63.10, shows the price exhaustion from sellers gave way to an opportunity for value seekers to step in.

A classic 1-2-3 setup is in place for a rally from here. Off the June 3rd price bounce a strong push to the swing high of 73.94 on June 12, gives us a clear indication of the coming setup. Next, comes the June 21 retracement level to 67.25 and subsequent mixed to higher price action.

What provides further technical evidence that the price will hold support is the bullish bias of the Pivot Stack. This new term in the technical realm is not yet known, but allow me to share.

The Pivot Stack is made up of 3 pivot ranges, the Daily, Weekly and Monthly. When they converge on one side of the price bar and compress to a narrow range, this is called the Pivot Stack which shows on July 1 (see chart).

Using multiple pivot ranges in combination, helps us to identify significant support and resistance and the directional bias of the stock.

At the beginning of a new period, Daily, Weekly and Monthly, the new corresponding pivot range will display on the chart. In this case, on July 1, we see the new Monthly Pivot (black circles) displaying at a higher level than the previous month, overlayed with the Daily Pivot Range (magenta/blue circles) and the Weekly Pivot Range (red/orange circles).

The timing of the Monthly Pivot Range (black/dark green circles) is the real impetus to the Pivot Stack coming into completion. The importance of the higher long term support of the Monthly Pivot, merging with the Daily and Weekly Pivots confirms the Pivot Stack.

With the Pivot Stack setup, the current bias is bullish and the probability of a renewed upward move is significant enough to take action. The tightly compressed series of pivot ranges is the ideal time to go long ALB, confirmed with favorable value and fundamentals in place.