Teck Resources Ltd. taking a breather but uptrend still in place

Dec 17th, 2010 – Comment

Currently the RSI is signalling an overbought situation and the MACD is turning lower. At this point it looks like TCK.B is going to pull back but nothing as yet is suggesting that the uptrend is broken.


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Good day, Lou:

Teck Resources (TCK.B) has enjoyed a terrific run over the past couple of years, surging to nearly $60 from around $10. But do you think it can continue this torrid pace?

Kind regards,

Gerald

P.S.: Your readings of the charts and analysis is excellent! The Globe & Mail is lucky to have you on board.

Hi Gerald,
Thanks for the assignment and for your kind words. Trust me when I say that I am lucky to be associated with globeinvestor.com. They do a great job helping investors stay on top of all the moving parts in the capital markets.
The last time I posted on Teck Resources Ltd. TCK.B TSX) was back on June 4, 2010 for Pat. At the time the advance had stalled and was taking a breather from a frothy run off the March 2009 lows. However in late August of 2010 it broke through long term resistance at $50.00 and is now in uncharted territory. Lets consult the charts to see if there is more gas left in the tank.
The three year chart depicts the range bound pattern that held sway over the stock from June to late August  of 2010 with support in place at $30.00 and resistance at $40.00. But as we came to the end of August TCK.B broke through resistance and has now started a new uptrend.
The six month chart provides a good view of the breakout has generated a 72.9% return from the low of $32.50 to the close on December 16, 2010. Merry Christmas! The MACD signaled the beginning of the advance in late August.There is also a golden cross that formed in mid October when the stock was trading at $45.00 suggesting that the up move had more left to go.
Currently the RSI is signalling an overbought situation and the MACD is turning lower.  At this point it looks like TCK.B is going to pull back but nothing as yet is suggesting that the uptrend is broken.
As a general rule I always suggest taking some profits off the table. You should look at your capital as if it were a thoroughbred. You wouldn’t race your horse everyday and you should take breaks in your exposure to risk.
MAKE IT A MASSIVE WEEKEND AND HAPPY CAPITALISM!
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