Russel Metals (Friday’s close $25.01) traded below a falling trend-line (dashed line) and below its falling 40-week Moving Average (40wMA) for about three years. The stock fell sharply below its Average last March (A) but then quickly reversed toward its Average and the falling trend-line.
By the end of 2020, Russel Metals pierced above the falling trend-line and above the 40wMA, which also started to turn upward to indicate a new up-trend. The continued rising price action (B) confirms the move toward higher targets (solid line).
At the same time, Russel Metals is becoming somewhat overbought and may have a minor correction. There is good support near $22.50-23.00; only a sustained decline below $20-21 would be negative.
Point & Figure measurements provide targets of $29 and $33. Higher targets are visible.
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Monica Rizk is the senior technical analyst and Ron Meisels is the president of Phases & Cycles Inc. (www.phases-cycles.com). And he tweets at @Ronsbriefs. They may hold shares in companies profiled.
Chart source: www.decisionplus.com
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