About the Author

Stephen Oakes is an experienced financial titan from New York who brings Wall Street to Main Street. Over the past 11 years, he has developed and tested the renown, Oakes Momentum System, which uses a unique constellation of technical indicators to find timely buy and sell points. He holds an M.B.A. in the United States (New York) and has studied internationally at the Reims School of Management in France.

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Momentum Stock: American Ecology (ECOL:NASDAQ)

November 8th, 2007 • Related • Filed Under

ECOL

American Ecology Corp (ECOL:NASDAQ) has seen its fair share of price swings over the past two years. However, when I applied an upper resistance line and a lower support, it was discovered that we have a symmetrical triangle pattern.

It is important to note that you should never trade the stock inside the triangle with the assumption that the breakout will eventually assume the trend prior to this particular pattern.

Instead, trade in the direction of the breakout. In this case the breakout was to the upside — as noted by the green arrow on the chart. Additionally, we have a buy signal on the Moving Average Convergence Divergence (MACD) indicator.

We may move sideways for a candlestick or two, but eventually another pop will occur and send shares into the stratosphere.

Our recommendation: Buy shares of ECOL at or near $23.42. Place a 5% stop loss below your purchase price.

Good investing…

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