Don't Ignore This Chart

Danaher Traces out Large Bullish Continuation Pattern

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Danaher is part of a strengthening sector (healthcare) and accounts for around 5.5% of the Medical Devices ETF (IHI), which is one of the strongest industry group ETFs this year. XLV is one of the best performing sectors over the last three months and IHI sports a parade of 52-week highs over the last few months.

On the price chart, the long-term uptrend is up because the stock recorded 52-week highs in January and July. Even though price action has been flat the last five months, an ascending triangle formed and this is a bullish continuation pattern.

The equal highs in the 104 area mark overhead resistance (supply), while the rising troughs show buying pressure coming in at progressively higher levels. A break above resistance would signal a continuation of the bigger uptrend and target a move to the 118-119 area. The height of the pattern (~14%) is added to the breakout level for a target.

The indicator window shows upside volume increasing over the six days. In fact, the stock surged on the highest volume since February and this reflects strong institutional interest.


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Topics for Tuesday, July 17th:

  • When to Ignore Rising and Falling Wedges
  • When to Consider Rising and Falling Wedges
  • Industrials, Healthcare and Finance Stand Out
  • Materials Sector Underperforms (XLB, MOO)
  • Bull Flags: XLV, SOXX, XSD, IBB, XBI
  • Stocks: ADI, DG, DHR, EL, KSS, LOW, M, ROST
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Arthur Hill
About the author: , CMT, is a Senior Technical Analyst at StockCharts.com. He has written articles for numerous financial publications including Barrons and Stocks & Commodities magazine. Focusing predominantly on US equities and ETFs, his systematic approach of identifying trend, finding signals within the trend, and setting key price levels has made him an esteemed technician. In addition to his CMT designation, Arthur holds an MBA from the Cass Business School at City University in London. Learn More
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