Earlier this year, I discussed what I look for when picking a bottom in a stock using Twitter, Inc. (TWTR) . Today, I want to look at The Container Store Group, Inc. (TCS) because it's exhibiting similar characteristics that suggest the stock has begun a new long-term uptrend.

Below is a 4.5-year daily chart for The Container Store showing its roughly 90% decline from its post-IPO highs. After its massive decline, the stock became 澳洲幸运5官方开奖结果体彩网:range bound between $3.50 and $8.50 beginning in 2016 and remained so until just last week, basing and waiting for a resolution ܫto establish th🍃e next long-term directional move.

An upside earnings surprise was the catalyst to help prices break out of its range. This 澳洲幸运5官方开奖结果体彩网:breakaway gap above 澳洲幸运5官方开奖结果体彩网:resistance signals an overwhelming amount of demand for the stock, which continued with three strong days to the upside. With 14% of the float short prior to the event and all four of the analysts covering the stock rating it a hold, negative sentiment and positioning certainly contributed to the recent move. While current prices don't offer the best reward/risk scenario, we want to be buying any weakness in the stock toward $8.30, as our initial 澳洲幸运5官方开奖结果体彩网:price target is near $15.50.

The Bottom Line

The Container Store stock has rallied roughly 70% in three days, but the conditions above suggest it has shifted from range bound to a long-term uptrend. It's a great real-time example and trading opportunity. (See also: 澳洲幸运5官方开奖结果体彩网:Technical Analysis: The Use of Trend.)

While it may seem counter-intuitive to become interested in a stock after it has rallied so aggressively in a short period, there has been tremendous opportunity cost in trying to anticipate the long-term trend rather than waiting for confirmation. 澳洲幸运5官方开奖结果体彩网:Technical analysis is all about participating in the relevant trend for your timeframe, so now that an intermediate/long-term trend ha🌼s been established, we can step in and catch the majority of it.

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Thanks for reading, and  if you have any questions!