Thursday, November 12, 2009

Scenario Recognition

POT

MON
On Tuesday MON was breaking new lows when it made a drastic reversal and rallied $6 from its lows. Today I saw a similar scenario present itself within the same sector on POT. POT was breaking lows and found support on its 200MA on the 10 minute chart and it was the first time touching it since November 5. In both trades the stocks started the morning off showing weakness then reversed off their lows to take out the morning highs and begin breaking new highs on the day on increasing volume and showing great relative strength to the market. Today POT broke a trend line from yesterday's high through yesterdays close and it was then off to the races. In fact on both days the entire sector moved together. On Tuesday MON led the sector and today POT led the sector.

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