T-Mobile US Inc: The Sky Is the Limit for TMUS Stock

TMUS StockTMUS Stock: No Resistance

T-Mobile US Inc (NASDAQ:TMUS) stock is ripping higher and creating new all-time highs in the process. I’ve got to give this company some credit; I didn’t think it could surpass the all-time high of $53.79 on its first attempt. This is the high that was created in 2007, a few short months after T-Mobile stock went public.

The new all-time high that is being created has tremendous bullish implications, and no upside resistance is just one of them. These implications are based on technical analysis. Technical analysis uses historical volume and price data to discern trends and forecast future prices. This style of analysis is the foundation of my investment views and trading strategies.

Bullish tailwinds were instrumental in driving TMobile stock back above its all-time high, and the following TMUS stock chart illustrates the development of these tailwinds.

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Chart courtesy of StockCharts.com

The stock chart above is nothing short of spectacular. There are so many great examples of how this ticker abides to the rules set out by technical analysis. These examples are clearly defined and the price action is simply pristine.

The indication that bullish tailwinds were swirling around TMUS stock were first confirmed after it completed a double bottom reversal pattern.

This reversal pattern took five years to form and is marked by two consecutive bottoms, separated by a peak in between. This double bottom reversal pattern was confirmed when TMobile stock closed above the peak that separated these two bottoms.

It is not uncommon for a price to return to a previous level of resistance that confirmed the reversal and backtest it from above. This price action serves to reaffirm that the reversal pattern is indeed legitimate, and solidifies that the previous level of resistance that was marked by the peak is now a new level of price support.

TMUS completed this backtest with the utmost precision, and after the backtest was complete, T-Mobile stock quickly reversed and resumed its new trend towards higher prices until a new all-time high was forged.

I did not expect that the all-time high would be breached on the first attempt, but now that it is finally broken, I could argue that the rules set out by technical analysis suggest that the stock is now set to test the $95.00–$100.00 level.

The following TMobile stock chart illustrates why TMUS stock was able to slice through the all-time high with such ease.

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Chart courtesy of StockCharts.com

The TMUS stock chart is littered with healthy bullish price action. Healthy bullish action contains impulse waves that advance price and consolidation waves that unwind any overbought conditions and set up the next impulse wave.

The impulse waves are highlighted in green and the consolidation waves are highlighted in purple. This is the exact price action that you want to see dominating a bullish trend. Each impulse wave has given way to a consolidation wave and this pattern is consistent. As long as this price action remains orderly, this bullish trend towards higher prices can persist.

The breakout highlighted on the TMobile stock chart above illustrates that price has exited a consolidation pattern in an upwards direction. This price action suggests that a new impulse is now in development and higher prices can be expected.

Bottom Line on TMUS Stock

TMobile stock has just created a new all-time high, and this feat suggests that there is further upside for this stock on many levels. The healthy and orderly price action supports this notion.