Hello new 52 week high! Yes, it was a new 52 week high for Sirius XM Holdings (SIRI) last week. This new high was made on volume that increased over the previous week. That is typically a bullish sign. So is it time to hang tight with Sirius XM Holdings (SIRI)? Or is it time to dump shares?

In my previous article, I was asking if it was a breakout or a fake-out for Sirius XM Holdings. I thought it was a breakout. A new 52 week high seems to be confirming my intuition.

For those that have been sleeping on the stock, yes, I am talking about Sirius XM Holdings (SIRI) with a new 52 week high. With concerns of peak auto at least subsided for now, SIRI may have one more obstacle to deal with, and that would be the manufacturing of autos in the USA rather than abroad.

While this manufacturing issue should not impact them directly, it is something to note and be aware of considering how the president-elect likes to tweet about industries and companies. Car companies have definitely been on the radar. Hopefully SIRI can stay out of it.

Just recently, one astute Trendy Stock Charts member inquired about SIRI and if it appeared to have developed a 3 Weeks Tight chart pattern and if I could confirm the pattern.

After looking at its weekly chart, I noticed there were 5 consecutive closes for SIRI on it that were within a 1% – 1.5% range. This meets the general requirements of a 3 Weeks Tight pattern. But the first two weeks were a little volatile and don’t quite fit with one of the guidelines. However, the last 3 weeks of the tight closes do fit in with the requirements and guidelines for the pattern. Let’s jump to the charts and see what it looks like.

Hang Tight With Sirius XM Holdings

This first chart is a duplicate of one I posted in the Idea Chamber yesterday. The gray shaded box reflects the area of tight closes that I discussed above.

This is a 2 year weekly candlestick chart for SIRI. A breakout with increasing buying volume on this weekly chart seems to be in progress.

Disregard the support areas marked on the bottom of the chart, it is from an older article.

The new support area for SIRI’s share price is around the $[s2If !current_user_can(access_s2member_level1)]……

If you want to continue reading this article, you must first sign in. If you are not a Trendy Stock Charts member, consider subscribing today. I have several different subscription plans available. I talk about different support areas in this article that can be used to make scale-in purchases as well as upside price targets.[/s2If][s2If current_user_can(access_s2member_level1)]4.20 area that SIRI has successfully re-tested. This re-test happened quick and was also part of the 5 weeks of tight closes. The quick drop in the share price, I believe, was during the week of the news of SIRI potentially acquiring Pandora Radio was being passed around.

Let’s place some tools on the chart and see where this potential breakout from the 3 Weeks Tight chart pattern could be headed to.

SIRI – Trendlines

The breakout for SIRI appears to be in progress. This potential breakout was identified in my previous article for SIRI titled “11/20/2016 – SIRI Breakout or Fake-Out?“.

The re-test of the breakout area was a swift one. Many investors probably weren’t able to even capitalize on the quick pullback for SIRI’s re-test of the breakout area unless they had a GTC order placed (good to cancel).

If someone were interested in being in SIRI, they could make a 1/3 scale-in purchase now with its share price potentially breaking out from its 3 Weeks Tight chart pattern as mentioned above. Or you could wait for it to finish its current uptrend and wait for the pullback. The choice is yours. Let’s see where the uptrend is heading.

This next chart for SIRI is a a weekly candlestick chart that covers about an 8 year period. Once SIRI can break through its current resistance area and continue its potential breakout from the 3 Weeks Tight chart pattern, it has some room to run, maybe even a little higher than the previous $5 mark established. At least that is the case from a trendline perspective.

SIRI’s MACD Histogram has a nice steady increase of buying momentum that is taking place. Monitoring this on a weekly chart is crucial to try and lock in gains at higher prices. After 2 consecutive decreases in the MACD Histogram in a 2 week period, it could be an indicator to re-analyze the charts and see if it is time to lock in gains. It “pays” to monitor the MACD Histogram.

Let’s use the Fibonacci Extension Tool to measure some possible upside price targets.

SIRI – Fibonacci Extension Tool

This is a 1 year daily candlestick chart where I’ve overlaid a couple of different Fibonacci Extension Tools to calculate some upside price targets.

The most probable price target range for the current breakout seems to fall in the range of $4.99 – $5.17, or right in between the 161.8% Target Lines for the two different Fibonacci Extension Tools. That is an area where I would start watching for signs of the breakout running out of steam and a good place to lack in some profits. Any shares sold above $5 could then be repurchased around the $4.75 area on any subsequent pullbacks.

Sirius XM Holdings (SIRI)

This chart is a 5 year monthly candlestick chart. SIRI has a possible breakout from a 3 Weeks Tight chart pattern as mentioned above. It has also closed above the resistance area from a Dark Cloud Cover candlestick pattern that is seen on this 5 year monthly candlestick chart.

Another thing going for SIRI on the above monthly chart? The MACD Histogram is reflecting a nice steady increase in buying volume. That is always nice to see on a monthly chart for the longer-term trend.

Any pullbacks back to the $4.40 area could be used as a scale-in buying opportunity. But with the current 3 Weeks Tight pattern breakout possibly starting, you may have to settle for the 4.60 area or so if you want to trade SIRI in the short term.

SIRI – Moving Averages

This next chart is a 1 year daily candlestick chart to analyze SIRI from a moving average perspective. A great, low-risk opportunity for SIRI has already passed. That is the 1st pullback below its 200 Day moving average after the development of a Golden Cross.

The next best opportunity to jump on SIRI’s uptrend as of now appears to be a pullback to the 50 Day moving average. As of now, the 50 Day moving average sits around the $4.50 area.

Sirius XM Holdings (SIRI) – Summary

From what I’ve seen, it definitely seems appropriate to hang tight with Sirius XM Holdings (SIRI), for both the shorter and longer-term.

Any potential breakout should see SIRI continue its buying momentum next week, with a minimum close above the $4.66 area and a preferable close around $4.75. If that happens and SIRI’s buying volume increases for a 3rd consecutive week, there is no doubt to me that the breakout is in the process.

However, with any market weakness, consider using the re-test of the breakout area from a 3 Weeks Tight chart pattern as a point to enter the trade or to repurchase any sold shares.

If any  general market weakness were to continue after the inauguration date an over a several week period, use any re-test of the original breakout area around $4.20 mark to re-load on any sold shares or to make another scale-in purchase to add to a position you are building. You should also find support from the 200 Day moving average around that price level, helping to support SIRI’s share price during whatever pullback is taking place.

As long as the market stays “slow and infrequent” with interest rate increases over the next few quarters, SIRI appears poised for continued success. So go ahead and hang tight with Sirius XM Holdings over the next several quarters.

Trade accordingly…..good luck trading….

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