Rackspace (RAX) At New Highs
Rackspace (RAX) came public near 10 in August 2008. The network provider then rallied to 11.95 and sold off with the broad market, bottoming out near 4 in February. It entered a steady uptrend in March, hit 19.20 in October and dropped into a sideways pattern. The stock broke out in Friday’s session, posting heavy volume and closing well, although other tech stocks got whipped around by the intraday reversal.
The stock is now trading at an all time high. A rising highs trendline in place since June limits initial reward potential to just above 22. The best trade entry should come when it fills the gap, which is a distinct possibility given the volatile tape. Alternatively, watch for a 60-minute consolidation pattern and buy the breakout.
December 6, 2009
• Posted in: Market Day
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