Spirit AeroSystems Holdings, Inc. (SPR) recently triggered out of a symmetrical triangle pattern, which formed over the past year.
The breakout occurred with a surge in volume, which lends confidence to the validity of the pattern.
There is a minimum expected price objective of 29 dollars, which is obtained by expanding from the breakout the same distance as the height of the pattern.
Currently, SPR is forming a bull-flag pattern that may provide a low-risk/high-reward long entry opportunity.
The trade will trigger with a daily close above the upper resistance line, which is 24 dollars. That $24 level was an important resistance point in mid 2008 and the first quarter of 2010.
A move above $24, therefore, will be significant.
Chart 1: This weekly chart of SPR displays the symmetrical triangle pattern that began forming in February 2010.
Photo: Zev Spiro
Chart 2: Below is a daily chart of SPR highlighting the recent bull-flag pattern, which has been developing over the past seven sessions. A breakout above the flag’s resistance can provide a low-risk long entry opportunity.
Trigger: Daily close above $24, Target: $29, Protective Stops: Conservative: confirmed move below $22, Aggressive: confirmed move back below the flag’s base.
Photo: Zev Spiro
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