FEYE – FireEye – flat base forming and moving averages coming together.

FEYE – FireEye Inc. Weekly Chart – The cyber security platform provider (in real time) to corporations and governments is setting up with a flat base. The beauty of the flat base is how it draws out and takes time to develop. In a cup and handle pattern, the ‘handle’ acts as the shakeout (weak holders sell their positions). In a flat base, the shakeout is in the time; people get frustrated and impatient and release their positions only to see the stock advance without them. ‘Shake outs’ help fuel a stock’s breakout due to the fact that the so called ‘weak holders’ aren’t there anymore to sell their positions for small gains, fueling the advance.

We have FEYE on the watch list with a breakout buy point of 16.35 (need at least 50% above daily average volume on the breakout, otherwise it will be failure prone).

Note in the chart how the moving averages are coming together this week for FireEye

FEYE FireEye Weekly Chart