Trades To Watch: Spirit AeroSystems

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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Disclaimer: The information contained herein is not guaranteed. This is not a solicitation of any order to buy or sell. This material is based upon information that I consider to be reliable, but I do not guarantee its completeness or accuracy. Assumptions, opinions and recommendations contained herein are subject to change without notice, and I am not obligated to update the information contained herein. I may have a position in the security or securities mentioned. This communication, including any attachments, is for the exclusive use of the intended recipient(s) and/or the intended recipient’s designees. Any use, retention or dissemination by a person other than the intended recipient is strictly prohibited. If you are not the intended recipient or designee, please notify the sender immediately by return e-mail and delete/destroy all copies of this communication.

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