Sirius Satellite (SIRI) has been trying to clear the 4.00-4.10 resistance area for two years now. This consolidation or basing period is very bullish since it follows a period of rising prices. We need to see the breakout first, however. SIRI reported its quarterly earnings and met Wall Street consensus estimates for earnings. Revenues did exceed estimates and guidance was raised based on strong auto sales. So the fundamental news supports higher prices, now we await technical breakout. The next move higher could be powerful after this lengthy consolidation period so look for a high volume breakout to initiate that move. Here's the chart:
Notice at the bottom of the chart that SIRI is beginning to outperform its peers and the broadcasting group has been a very strong area of the market for years. All of this adds up to potentially sizable gains if we see the desired high volume breakout on SIRI.
Happy trading!
Tom
