August 21, 2012 (By Frank Kollar)
Back in early August, our stock timing strategy added Goldman Sachs Group (NYSE: GS) as a buy and has since been following it in the stock timing strategy.
There were several reasons for the buy signal. Goldman Sachs, after a steep correction from its 2012 trading g highs, had just finished making a very well defined triple bottom (using a daily chart).
That bottom was at $90 a share which similarly stopped the 2011 full year decline.
Since reversing higher, Goldman Sachs has added over 16%. The odds of higher highs and continued gains are excellent.
Note that on Monday, August 20th, Goldman Sachs broke above its 200-day moving average after having stalled just below this level for two weeks.
Chart Courtesy of StockCharts.com
Goldman Sachs has initial resistance at the 50% retracement level for the entire March to June decline. This is at $109.32.
A close above $109.32 would forecast a run to the next resistance at $113.77, the 61.8% retracement level. After that, we would be looking for a test of the 2012 highs at $129 a share.
The Fibtimer.com (http://www.fibtimer.com) Stock Timing Strategy holds a position in Goldman Sachs.
Disclosure: I am long GS.