Arena Pharmaceuticals, Inc. (ARNA) has been the definition of “relative strength”. Please observe the chart below.
The cup & handle pattern formed by ARNA in 2018 is not nearly as impressive as the relative strength the stock has demonstrated over the past week. Price action over the past seven trading days has consolidated sideways to form the handle of the bullish basing pattern while the broader stock market has corrected to the downside. Given the information provided by the current daily chart, we think ARNA is poised to breakout once a definitive move back higher by the broad market gets underway. Put ARNA on the bullish side of stocks to watch.
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