Down Is Good, If It Leads To Strong Bases
Posted on October 30, 2009 at 18:45 PM EDT
The one redeeming factor of a correction is that what starts out as bad news can become good news. Many stock declines will turn out to be base-building exercises. American Superconductor (AMSC) is further along the construction process than many stocks. After it gapped up in July, it immediately began forming a second-stage base. It broke out of the second base in mid-September and then fell, triggering the 8% sell rule. But the slide morphed