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A customers walks out of a Family Dollar store at Hickory Grove Market in Charlotte, N.C.

ROSS TAYLOR/AP Photo/Ross Taylor

In our previous report on May 30, 2009 ($30.46), we suggested that Family Dollar Stores was about to complete a bullish "W" pattern (dashed lines - pattern begins in 2004) and that a rise above $35-$36 (the neckline of the formation - dotted line) would confirm this. Following our report, the stock pulled back toward $26 (A) and then started a sharp rise that pierced easily above the neckline to reach a high of $42.07 (B). The subsequent correction found support at the neckline (C). Only a decline below the 40wMA (currently at about $34) would reverse the current long-term upside potential.

Point & Figure measurements provide targets of $49 and $54. The large "W" formation (dashed lines) supports significantly higher targets.

Ron Meisels is a contributor to the www.NA-marketletter.com website. Monica Rizk is the senior Technical Analyst for Phases & Cycles Inc. They may hold shares in companies profiled. Please see the site for a glossary. Source: www.decisionplus.ca

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About the Authors
President of Phases & Cycles Inc.

Ron Meisels, President, Phases & Cycles Inc., has been active as an Analyst since 1971. He was Vice President and Director of Technical Research of Nesbitt Thomson (now BMO Nesbitt Burns) from 1982 to 1990. He was ranked among the top three technical analysts by Canadian Institutions for six consecutive years (Brendan Wood Survey). More

Senior Technical Analyst at Phases & Cycles Inc.

Monica Rizk, Senior Technical Analyst, has a Bachelor's degree in Business Administration and completed the Canadian Securities Institute course. She has been with Phases & Cycles since September 2000 and specializes in the research of Canadian and US stocks using Point & Figure as well as bar chart analysis. More

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