Don't Ignore This Chart!

Classic Ascending Triangle Breakout On This Software Stock

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Imperva Inc (IMPV) made a steady move higher from April through July before consolidating in a very bullish ascending triangle continuation pattern over the past four months.  On Tuesday, volume accelerated and triangle resistance near 74.00 was cleared as IMPV extends its prior uptrend.  The measurement of this pattern is from the bottom of the triangle in late August (53.00) to the top of the triangle (74.00), or 21 points.  Once we see the breakout on heavy volume, the target becomes the breakout level (74.00) plus the measurement (21 points), or 95.00.  Best entry on a breakout of this nature is during a retest of prior price resistance (now price support) near 74.00 with a potential second entry at the rising 20 day EMA, currently 71.59.  Recent November lows would serve as key price support to watch in the near-term.  Here's the chart:


Happy Thanksgiving and happy trading!

Tom

Tom Bowley
About the author: is the Chief Market Strategist of EarningsBeats.com, a company providing a research and educational platform for both investment professionals and individual investors. Tom writes a comprehensive Daily Market Report (DMR), providing guidance to EB.com members every day that the stock market is open. Tom has contributed technical expertise here at StockCharts.com since 2006 and has a fundamental background in public accounting as well, blending a unique skill set to approach the U.S. stock market. Learn More
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