TGS 31.03.2008

TGS has been in a weak upward movement since end January 2008. There was a top mid-end February of 84.40 NOK but has since then fallen back a bit ending at 74.10 today which was up 1.5% from last traded day. A nice upward moving support trendline has developed along with a downward moving resistance trendline forming a wedge. From the movement within the triangle we can so far say that this is a "valid" wedge. Looking at the RSI chart we see that this coincide well with what we see in the price chart. There seems to be room for an upward movement in the stock price to about 79 -80 NOK where we find the resistance line. There is also room for a fall in stock price back to the support line at about 70 NOK. If you want to buy the stock now put your stop loss at about 70 NOK or just below the support level. This level correspond well with the commonly used stop loss philosophy of applying 1* ATR. You could also wait and see if the stock price falls back to the support line and buy the stock then.