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Glu Mobile Inc. (NASDAQ:GLUU) – Strong Above $2.90-$3

Boston, MA 09/30/2013 (wallstreetpr) – Glu Mobile Inc. (NASDAQ:GLUU) (Closed: $2.82, Up: 6.42%) opened flat but soon gathered momentum to rally above the range created over the last 6 weeks and close firmly near the previous major swing high of $2.91 made in last July. The price action created a long bullish candle that engulfed the entire range of Thursday. The volume shot up at 5 million, more than double the average of less than 2 million.

The stock had made its debut in just the beginning phase of one of the most violent bear markets in the history and as expected, after a brief period of respite to make a rally to $14.80, it was massacred like all other stocks. The fall from the 2007 top of $14.80 took the form of a Triple Corrective, three correctives punctuated by two small X waves. This pattern looks very similar to an impulsive wave, but the difference comes out when the supposed 3rd wave gets shorter than the 1st, which impossible except a special case, according to the Elliott Wave Theory. This pattern, if correctly interpreted, gives a pattern implication target of 80% retracement. That would give us a long term target of $11.88 but before that, we would have to be convinced about the termination of the pattern. The last corrective frequently turns out to be a Triangle and must be kept an eye for.

Last week, the price broke out of a down trend channel containing the entire price action from the April 2013 low of $2.46 and also above the supply zone in $2.50 – $2.60. The channel gives us a target of $3.70, close to the 2013 top of $3.86. But to reach there, the price must break and sustain above the zone of $2.90 – $3. Investors could accumulate the stock if it manages to stay above this zone.

Published by Viraj Shah

Viraj Shah has done M.Com (Finance) and currently pursuing CFP. He is a technical analyst who tracks US markets along with other global markets like India very closely. He is very passionate about stocks and believes that money can always be made in market.

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