Five stocks with strong continuation patterns are Patrick Industries PATK , Builders FirstSource BLDR , Louisiana-Pacific Corp. LPX , Altisource Portfolio Solutions S.A. ASPS , and XPO Logistics XPO .
PATK has been in a beautiful rising channel since November of last year that has taken the stock up sevenfold from 2 to over 14. That takes it to multi-year highs not seen since mid-2007.
Its surge on Monday of 1.24 (9.61%) to 14.14 took it to the top of its triangular ascending channel, positioning it to break above the resistance line from March and its 52-week high of 14.47.
BLDR similarly has risen since November of last year, in its case threefold from the 1 1/2 area to Monday's close of 4.35. The stock has been consolidating in a narrow, rectangular pattern for the past three months, and its rally of about 9% in the last three sessions positions it against its resistance line.
Considering the strong momentum in the past week, the stock looks set to break higher and rise above its 52-week high of 4.55.
LPX's move of more than 2% on Monday broke the stock through its resistance line in the 10 area that has contained prices since March. The stock, up 10% so far in June, also is poised to continue the uptrend that has seen LPX more than double since early October.
ASPS, too, has broken through resistance with its moves of the last few sessions, up 4.4% yesterday to 70.37, and is now at a new all-time high. The stock, which has also doubled since October, is positioned for more upside.
Lastly, XPO has edged above the top of its sideways channel in which it has consolidated over the past three months, after a surge from 7.05 in early October to 18.34 in early March. On Monday, the stock closed at 18.87 after hitting a new 52-week high of 19. The breakout could move the stock toward the 21 level.
See annotated charts on these stocks illustrating the patterns.
Disclosure: Mr. Persich is long ASPS and PATK.
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