Shares of Hexcel Corp (HXL) have crossed the 28 threshold that I had identified on my watch list.  Let’s take a look at why I have focused on this as an area of interest.  In this case, I went to the monthly chart, which takes us all the way back to 1984 (rejoice Detroit Tigers fans!).

Using this timeframe gives us almost 30 years of price and volume data…you can clearly see that there isn’t a whole lot in the way of potential resistance above 28.  Again, keep in mind that this doesn’t mean resistance will not form in this area, but that, currently, it doesn’t exist.

Drilling down to the daily chart shows that this stock has been surging higher the past few days.  Instead of trying to chase into this area, I want to wait for a consolidation/pullback to assess how the stock behaves.

Clearly there is significant support/congestion under 28, so any pullback that remains around/above that level will signal a good opportunity to buy.

Then again, this thing could rocket straight to 32, leaving me in the dust.

-EM

Tweet