After falling about 7% on May 10 Altria Group's stock price rebounded, forming a Double Bottom pattern.
The drop came in light of the May 9 announcement that Philip Morris was in talks to acquire Swedish Match, a European manufacturer of smokeless tobacco products. Philip Morris used to be a part of Altria, and even after it spun off as an independent entity, the two companies maintained close ties. Philip Morris' potential acquisition of Swedish Match could be bad news for Altria Group and its ability to hold its niche among the largest tobacco companies in the United States.
Nevertheless, the Three White Soldiers pattern was formed in the daily chart and the price broke the neckline of the Double Bottom pattern. The DeMarker indicator has just moved out of the oversold zone, suggesting there is space for further growth. It could help Altria Group's stock price return to 55.14 level to close the gap and recoup the fall.
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