By Mill Chart
Last update: Oct 8, 2025
Technical analysis investors often look for stocks showing both good momentum and good entry points. One method finds securities with good technical health that are also forming consolidation patterns, indicating possible breakout chances. This method uses ChartMill's Technical Rating, which measures a stock's overall technical strength, with its Setup Quality Rating, which judges the quality of its current price pattern for a possible entry. Stocks with high scores on both measures may offer interesting risk-reward situations for technically-focused investors.
Technical Strength Assessment
Cardinal Health Inc (NYSE:CAH) shows very good technical features according to ChartMill's evaluation system. The company gets a perfect Technical Rating of 9 out of 10, signaling good underlying momentum across several timeframes. This high rating shows a number of positive technical qualities that match the strategy's need for technically good stocks before looking at entry timing.
Important technical strengths are:
These features are important for the breakout strategy because stocks with good technical bases are more likely to maintain momentum after successful breakouts. The steady performance across different timeframes points to institutional support and lowers the chance of false breakout signals. The detailed technical analysis report gives more information on these measures.
Setup Quality Evaluation
Besides its technical strength, Cardinal Health shows an interesting setup pattern with a Setup Quality Rating of 9. The stock has been moving within a set range between $145.87 and $159.24 over the last month, and is currently trading in the middle of this band. This consolidation phase has happened with lower volatility, forming a possible base for the next price move.
Notable setup features are:
The setup quality is important for the strategy because it finds times when a stock's price movement has tightened after a rise, possibly offering good entry points with clear risk limits. The lower volatility during consolidation often comes before notable price moves, while the set support and resistance levels allow for accurate trade planning.
Trading Considerations
For investors using this technical method, the analysis indicates a possible breakout above the $158.63 resistance level could mark an entry chance. The nearby support area around $155.15 gives a sensible place for stop-loss orders, creating a clear risk situation. The automatically created setup indicates a risk of about 4.06% from entry to stop-loss levels.
It is important to note that the space between possible entry and exit points is fairly small compared to the stock's average daily movement, which might need careful position sizing. Also, traders should watch for any fundamental news or earnings reports that could change the technical view.
Finding Additional Opportunities
The Technical Breakout Setups screen that found Cardinal Health is refreshed daily with new possible chances. Investors wanting to find similar setups in the market can access the current screening results to see other stocks meeting these technical requirements.
Disclaimer: This analysis is based on technical indicators and pattern recognition and should not be considered investment advice. The mentioned trade setup is automatically generated for illustrative purposes only. Always conduct your own research, consider your risk tolerance, and consult with a financial advisor before making investment decisions. Past performance does not guarantee future results.
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