I am mainly a chartist, and it appears that VRGN is forming the "CUP WITH HANDLE CHART". The cup has already formed, now comes the handle, if I am right. In many cases the handle brings the price of the stock down to around half of the recent run-up (right side of the CUP). In the case of VRGN, that would be around 4 3/8 - 4 5/8 range.
CUP WITH HANDLE = \_/\ = FAST DOWN, THEN FLAT, THEN FAST UP, THEN DOWN
Don't take it wrong, the CUP WITH HANDLE chart is normally a positive sign of a stock gaining strength. After the handle is formed many stocks remain flat for a while forming a new base, which is good for a stock with potential and promise. Keep in mind that the key is that this new base is higher than the previous base.
Obviously, we would love to have VRGN continue up, but if there is nothing to push it up further (good news/ contracts/ earnings, etc), then VRGN will fall, forming the handle. Some type of good news is neccessary to both keep VRGN where it is, or push it up further. Also the overall market will have an effect.
The Cup with Handle chart is normally a good sign that the stock is gaining strength.
I have been in and out at 3 7/8, 4 3/16, and 5. The charts looks good overall if you are willing to wait, but if you are trading for the shorter term, there is a good chance VRGN will head to 4.50 range, unless some good news comes soon to support it. |
