DRYS DryShips Inc Starting to Look like a Good Long Setup

DryShips Inc.  is starting to shape up quite nicely for a possible northward breakout above the all important 5.0 level.  DRYS appears to be completing a small handle formation of a cup and handle pattern.

What I like MOST about DRYS is that fact that on 9/28/2010 DRYS had a 50 million share day that tested several other price swings on 400% greater volume.  In other words DRYS tested the top left side of the cup portion no 400% greater volume.  This is an extremely bullish sign that 5.0 should eventually be exceeded.

My take on DRYS is that it is not currently in a strong new uptrend yet.  It is still choppy and somewhat of a sloppy stock with a large trading float.  For this reason I view DRYS as more of a shot gun type long setup.

It is currently showing a bullish triple P on the MACD histogram which would be confirmed with a close above the 10/13/2010 swing high.

The volume is telling me this one is going to pop again soon and bust above 5.0  How soon is tough to say but perhaps within another week or two given yesterday’s low volume rejection of the supportive range.

Posted in Stock Setups

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