Imperial Sugar(IPSU): Hungry For More

Posted by barkand on August 1, 2011 under Classic chart patterns | Be the First to Comment

Imperial Sugar(IPSU) has more than doubled since it made lows back in March. So now that prices have flattened out over the last several weeks, we have to wonder: is this a top or merely a base on the way to still higher prices?

In our opinion, IPSU has more to give us. The stock’s 20-day moving average held up well as support last week. That is especially impressive when you consider how poorly global equity markets had performed (thanks, Washington).

Recent trading volume also profiles as something more likely to be seen in a base rather than a top. First, you will notice that volume has dried up as the base developed. And the higher volume tends to come on “up” days. If this was a top, we would expect to see the opposite.

Short and sweet: we expect Imperial Sugar to give us at least one more rally.