By: Zev Spiro
In yesterday’s comments I mentioned that tops develop over time and distribution patterns will form on the charts. The following trade idea for Domtar Corp. (UFS) is based on a previous break of an uptrend with a potential distribution pattern forming, that if triggered, will present a compelling short opportunity. Be cognizant of prices as it is a very thin issue.
The chart below highlights the December 15th break of a six month uptrend, that began in the summer. Currently, there is a potential bearish head and shoulders pattern that will trigger with confirmed break of the neckline.
Trigger: Break of the neckline, which is currently just above $75, Target: $66, Protective Stops: Confirmed move back above the neckline.
If you are interested in receiving Zev Spiro’s market letter, please email zevspiro@oripsllc.com subject “T3.”
*DISCLOSURE: No position at this time
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