Let’s $HACK this chart! – August 1, 2023
This is Scott with your Chart of the Day. I want to take a look at HACK ( NYSEARCA: HACK ). This is the Cyber Security ETF and it has a classic bottoming formation pattern that I want to bring to your attention in case you missed it.
This is something that we have been watching lately over at StockMarketMentor.com and I want to kind of hack this chart in a way and kind of give you some insight on what I look for in terms of stocks or ETFs, in this case, that are in a bottoming formation and have a chance to make a move to the upside.
Now, we are seeing this pattern, in this market, play out over, and over, and, over again. So this is something that you will want to remember the next time you see it. What I like to look for, when it comes to a stock that is in a kind of choppy bottom range is, first I want to see a clear level of resistance. We definitely have that here with HACK ( NYSEARCA: HACK ).
You can see these tops over here, and over here. So you can put a line there and say, that’s a pretty clear level of resistance. It has a price history going back a couple of months. It tried to get above but failed. It tried again and failed. It tried again and failed. And so that is a pretty clear level of resistance.
And then we want to see some progressively higher lows, Now, these lows here; they are choppy and sloppy but you can connect a few of the lows. We have maybe a little bit of a higher low, although, I don’t think this is a great example, but you get the idea. We are just looking for stocks to find support at higher and higher levels.
Sometimes they will come down and break those local zones, but they will, ultimately, find support around clear zones where they have had buyers step in before. That is something we’ve been watching here on this chart. And once it got above this clear resistance zone you see it just starts marching up and around the 8 and 21-day EMA.
Now, we are on the cusp of, what I think is a breakout in Cyber Security stocks. We are seeing that play out in stocks like CrowdStrike ( NASDAQ: CRWD ), which is one that we are trading over at Stock Market Mentor. We are seeing a nice breakout here today, as well as others.
So this is definitely a sector that I think you should keep your eyes on because it looks like it has come out of a bottoming formation with clear levels of resistance. And clear higher lows, and is now trying to recapture some of its old highs. And so this is definitely an area that I think you should keep an eye on and one that we’re watching right now. If this is helpful definitely add it to your watch list.
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