GS, AMZN, AGU And TIE

When targets get MADE, that doesn't mean that a stock is going to reverse right there and go in the other direction, but that often is the case, as it was with Goldman Sachs (GS) and with Amazon (AMZN) yesterday.

After the 174.80 target in GS got MADE, it rallied only a little bit more, to 175.34, then gapped down yesterday on disappointing earnings, below the recent Cup & Handle breakout (blue horizontal trendline).

When GS gapped to the upside on January 3, 2011, it left a gap in the chart (the two horizontal green lines). GS came back and filled that gap, then broke out again and the 174.80 target got MADE. That was very nice, technically. Yesterday, however, in adddition to breaking back below the breakout, GS also took out the low of that little gap-filling black candle. UGH. When technicians say, "Some technical damage has been done the chart," this is an example of what the mean. Instead of the blue breakout trendline and the two green horizontal bars being support, they now are resistance because players who thought that they bought a successful gap fill and another upside technical breakout find that they haven't, and many of them will be inclined to sell on rallies back to the gap-filling candle (green horizontal bars) and what currently looks to be a failed breakout (the blue horizontal bar).

GS needs to close back above the breakout to turn this chart bullish again, which might prove difficult. Yesterday's selloff was on heavy volume and the candle is a long black one, closing near it's low, suggesting that players threw it in going home.



Like GS, AMZN rallied to the last of our upside targets, 191.50 (it got to 191.60), then sold off yesterday. Another of many examples why it's a good idea to "take at least 'some' profits when targets get MADE."

This chart looks much better than Goldman, however, because rather than closing below two levels of support as Goldman did yesterday, AMZN has at least three possible levels of support below it, and still is well above the two pattern breakouts that we've discussed. Possible support levels are listed on the chart.



Agrium (AGU) has been one of many stunning performers off the November, 2008 Bear Market low. It's up over 300%. AGU broke out of this Bull Flag (patten in green) on January 12, leaving a gap in the chart from its January 11 close of 90.91. Yesterday, AGU retested the upper trendline of the breakout and also filled the 90.91 gap. That trendline comes in today, January 20, at 90.65. A little intraday dip below that would be fine, but I shouldn't like to see a CLOSE below that trendline.



On January 18, Titanium Metals (TIE) rocketed out of this big Falling Wedge (pattern in blue) on a Breakaway Gap, also taking out the recent highs of 18.89 and 18.85. That got "called back" yesterday, much like a long completed pass does in football when someone is off sides ;)

In yesterday's selloff, most of the gap from the January 14 close of 18.30 got filled (yesterday's low was 18.41) and the Falling Wedge trendline got retested. 18.30 might get filled here, but as long as the trendline holds up, TIE looks like it has some further upside.