Stock Chart CHTT

Posted by downtowntrader | 4/12/2009 09:21:00 PM | View Comments

Stock Chart Analysis CHTT

Chattem Inc.(Public, NASDAQ:CHTT)

Chattem, Inc. (NASDAQ:CHTT), the maker of well-recognized brands such as Icy Hot®, Gold Bond®, Selsun Blue®, ACT®, Cortizone-10® and Unisom® is looking very bearish to me on longer term time frames. In looking at the chart below, it broke under a 5 year up trendline in February. It also looks like it broke under a confirmed head and shoulders top and failed the retest of the neckline. All of this is occurring in the weekly chart, which should weigh on any patterns on the daily charts.

While it is probably a little oversold on the daily charts, it has been showing relative weakness to the general markets. Notice that it has failed to take advantage of the very strong bear market rally we have had the last few weeks. With the general markets starting to get overbought, it's possible that the indices will have a stronger correction in the near future. With that in mind, picking out a market laggard such as CHTT could reward with a decent trade. The $60 area looks like a good area to draw the line in the sand for a bearish position on this stock, although I would prefer an entry at least near the $55 level.

Good Trading,


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