Wow what a reversal for a Dow Jones Index stock!
DuPont (DD) shares surged higher from a trend reversal and breakout event.
We’ll start with the Daily Chart for additional information and level planning:
DuPont (DD) was recently one of the weakest stocks in the Dow Jones Industrial Average, but the last three trading sessions changed that perilous position.
Shares traded in a persistent downtrend from the March 2015 high above $74.00 per share to the current “Rounded Reversal” pivot low under $48.00 per share.
Note first – before we discuss reversals – how there were many pro-trend “flag” or retracement trading opportunities that were successful.
We trade retracements – or pullbacks – in the direction of the prevailing trend.
For detailed information and insider tips on how we recognize and trade retracements, check out our “Perfect Pullback” Strategy Lesson Bundle.
Now let’s talk about the current reversal.
A length positive momentum divergence undercut the lengthy daily downtrend, and price formed bullish reversal candles and a strong bullish engulfing candle on October 2nd.
Monday’s session was another bullish rally on visibly higher volume (15 million shares) and today’s session continues the bullish surge with a strong gap and additional upside action into today’s high of $58.00 per share.
The catalyst for the reversal and strong upside price action is the surprise announcement of the resignation of CEO Ellen Kuhlman, though the reversal and divergences developed through September.
Let’s pull back the perspective to our Weekly Chart for more information: Continue Reading…