Reynolds American Breakdown

By | September 23, 2014

23. RAI chart

Shares of Reynolds American (RAI) rallied sharply off their February low this year, then pulled back from their July highs and began moving in a triangular consolidation pattern. The stock price is breaking below the pattern support line in today’s session and any continued breakdown could become volatile. Bollinger bandwidth has contracted to a point, which, in the past, has seen volatile moves following periods of consolidation. A close below support in lower candle range would be a good risk/reward short entry point with a buy-to-cover stop above triangle resistance.

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