THCX Stock: New All-Time Highs Are Not to Be Dismissed
The quest for the next money-making investment is always an adventure, and I have been at it for almost two decades. I have made many mistakes along the way, but I have learned from those mistakes and I have kept at it. I have learned that there are unique factors that make an investment compelling, and that’s why I’m currently focusing on Hydropothecary Corp (CVE:THCX, OTCMKTS:HYYDF) stock.
The compelling factor that makes Hydropothecary stock intriguing stems from the THCX stock chart, which means the unique factors I seek are technical in nature.
The method of investment analysis that uses the company’s stock chart in order to generate a view on it is called technical analysis. This method of investment analysis is based on the notion that historical data, such as price and volume, can be used to forecast what the future may bring.
The following stock chart illustrates the technical development that has me believing that higher Hydropothecary stock prices are on the horizon.
Chart courtesy of StockCharts.com
This stock chart illustrates that, on December 5, the stock broke above a very important level of price resistance, which resided at $2.90. This price point marked the previous all-time high established on April 11, which was a month after THCX stock began trading.
After this level was established, a significant sell-off ensued and the stock price finally found its footing in July. It has been making a move toward higher prices ever since. In November, Hydropothecary stock returned to test its previous all-time high but failed on its first attempt. The second attempt proved victorious, and the stock soared by 18.69% on that day.
Breaking above a previous all-time high that was set shortly after a company began trading is a characteristic that is shared among some of the best-performing stocks. This year alone, I would have to say that any stock exhibiting this type of pattern has been a top performer, and I would have to rank it among my top patterns, with the highest likelihood of success.
This pattern, as simple as it is, is all I need in order to carry a bullish view on this investment. There is a caveat, of course; the share price must not fall back below the previous all-time high. If such an event were to occur, I would have no choice but to rescind my bullish view on this investment.
Now that I have established why I am bullish on the stock, I will outline the pattern on the stock chart that can be used to create a price objective for my bullish view.
The following stock chart illustrates the pattern that can be used to create a potential price objective.
Chart courtesy of StockCharts.com
The pattern highlighted on the THCX stock chart is a cup and handle pattern. This pattern is characterized by two distinct troughs, where the first is much larger than the second.
This pattern was completed on the same day that the previous all-time high was breached because the cup and handle pattern was created by this level of price resistance. Now that the pattern is complete, it suggests that higher prices are now in development. The pattern itself can be used to generate a potential price objective.
This objective is obtained by taking the depth of the cup and projecting that value above the level of resistance that created it. The depth of the cup is $1.80, and the level of resistance that defined this pattern resides at $2.90, which suggests that an upside target of $4.70 is plausible.
I am bullish on Hydropothecary stock because the picture painted on the THCX price chart suggests that this investment has a lot further to run. I will maintain this bullish view as long as THCX stock is trading above $2.90 on a closing basis, which is its previous all-time high.