Kevin I agree that this cup and handle is different from the
usual cup and handle formations where essentially the
company's fundamentals to change within a few weeks,
the right side forms down then the left side goes up etc.
In CNC's case what prompted the formation of the right down side
( weak fundamentals ) is unrelated to what prompted
the formation of the left side ( the coming of Wendt ).
Still however the functional outcome will be the same
as a regular cup and handle because
a) during the downside right side of cup, most weak hands sold.
b) it formed a good, lengthy [ 10 week ] base,
c) then broke out on strong volume
d)followed by the handle formation as the last weak hands get shed
and profit taking
New breakout should be confirmed as soon as we break above
the pivot point of 11.5.
Bottom line is that this,
functionally, is a cup and handle ,
as far I am concerned.
I appreciate though your efforts at pointing out any and
all darkside of CNC:
it helps as longs to stay honest to ourselves, <vbg>
BTW if you have shorted the stock I hope you covered by now,
:-)))
TA
Message #1677 from Kevin Podsiadlik at Jul 10, 2000 7:44 AM
Thanks for all the backup material.
Investorpedia: "As the stock comes up to test the old highs..." Sorry to point this out again, but 11 3/4 was in no sense of the term an 'old high'.
Haiku: "The stock rises to a peak, then falls, forming the left side of the cup" In CNC's chart, the left side of the "cup" is simply the acceleration of a longer-term downtrend. There's a natural tendency to dismiss whatever the stock was doing prior to the formation as irrelevant since it's neither part of the cup nor the handle. But I'm afraid it just doesn't work that way.
Beware of doing TA with your head tilted at a 45 degree angle.
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