Breakout trade in CWENClearway Energy (CWEN) is showing all the signs of a pending breakout move higher.
The stock has formed a base from November to present with price action compressing and pullbacks getting shallower from left to right - a sign that supply is no longer coming to market as the market works through sell orders in the $37 - $38 range.
CWEN is an alternative energy stock, and that sector is currently outperforming 95% of the market (ranked 8/197 in relative strength). This breakout could be part of a larger group move and an underlying theme I am seeing from potential leaders in the next bull market.
The stock has formed a pivot over the last week and a half, trading in a tight 4% range. A move outside of this area could lead to a nice move higher as the stock releases its energy from a large base.
Consider buying on a breakout above 38.30. And thanks to the tight pivot area, you can place a sell stop order at 36.30 to risk just 5% on the trade.
