Slope Of Hope with Tim Knight

Compelling Compellant

I am long the chart below, which is a network storage system maker. I like the pick-up in volume and the clean recovery from the breakout. It's higher-risk, given the recent rise, so my position is relatively small.

Some Battered Bouncers

Here are a few long ideas of stocks which, long-term, don't necessarily look great, but short-term, look prone to a bounce higher after selling off the past couple of months.

 

Harry Boxer's Charts of the Day

Originally published on TheTechTrader.com.

Pay UP

I've mentioned Verifone Systems (PAY) before, and it's having a pretty good day. This is an impressive pattern. I am currently long this stock, and I hope to be so for a while!

Buys and Their Stops

I started today relatively "light" with 90% commitment and 144 shorts. I have added positions and am now 118% committed with 157 shorts, 3 ultra-shorts, and 10 longs. The longs, and their stops, are:

BLK........139.15
BP........34.70
CCI........40.01
CFFN........25.50
DV........37.41
ESI........51.11
ETM........4.96
PAY........23.77
RIG........50.44
SOL........7.74

I Like Longs

George Carlin, the patron saint of the Slope of Hope, began one comedy bit by saying, "I like people." The audience burst out laughing, because anyone familiar with George's work knew that he was fairly misanthropic. But he was serious, because his point was that he liked people on a one-on-one basis, and not for particularly long periods of time (90 seconds was just about right for him).

I know how he feels, because my attitude is largely the same. So, likewise, when I say "I like longs", there's no reason to guffaw at this purported permabear, because there are some charts I really like on the long side.

Having gone through my charts early (on Friday evening, as opposed to the weekend), I marked 25 potential longs and 100 prospective new shorts. I wanted to share a handful of them today.

One of them, I've mentioned before, but it's so fantastic it's worth mentioning again. Boring, staid, snoozer Pacific Gas & Electric is just a sensational chart. In addition, I did something I don't think I've ever done in my life.....I found out its dividend, which is about 4%! I don't know why everyone in the country doesn't own this stock. I mean - 4% in this 0% environment is just spectacular, and the chart is one of the prettiest I think I've seen.

Not all the longs are in classic breakout patterns. Some of them are simply so battered that I think they're due for a meaty bounce, and even if they don't bounce, their risk is relatively small (assuming they don't gap down pre-market on some ungodly horrible announcement). Here's a beauty of an example:

Another "bouncer" which looks somewhat healthier is Blackstone, which has a good double bottom. A 10% climb on this in very short order seems reasonable, and perhaps much more.

Lastly, a gigantic basing pattern from PAY looks just dynamite on the upside.

If I believed the market was by and large healthy and poised for gains, I would be 100% long with stocks like this. God knows my life would be infinitely easier, because trying to make a buck over the past year has been the triple-diamond-black slope of trading history. It's been just miserable. I pray for the day when the market is filled with patterns like those above, because gobbling up great looking charts and profiting from the upside sounds like a slice of heaven to me.

In the meantime, these are nothing more than hedges. They're stunning hedges, nonetheless, and I've got 21 more I like as well.

Constructive Pattern for QCOM (by Mike Paulenoff)

Let's notice that during the August corrective period, Qualcomm (Nasdaq: QCOM) has carved out a contractionary, coil-type consolidation pattern in the aftermath and atop its prior explosive upmove from the July low at 31.51 to the Aug high at 40. At its deepest corrective price of 37.45 at the 8/16 low, QCOM had retraced only 30% of the entire prior upleg.

As of this moment, QCOM is trading above 80% of all of its action since the July low, which is a very impressive feat, and a bullish sign. The overall picture is very constructive for upside continuation from the coil, which projects to 42.00/50.

Originally published on MPTrader.com.

Slow but Steady

I'll mention that one really terrific looking pattern for long-term investors is Pacific Gas & Electric's, shown below. It's not very exciting, but it sure does look powerful.

Trading Ideas: ZSL Long (by Retracement Levels)

Trading Ideas: Go LONG ProShares UltraShort Silver (ZSL) between the 31.20 and the 29.56 level.

Chart:

Trading Rationale:

1) CCOC Analysis:  3 days down, 0 weeks down, 0 months down.  The Daily odds look good at 89.18%.  Worth trying a Daily LONG trade here. Since the Weekly and Monthly time periods are not oversold (0% CCOC odds to go LONG), we do not expect to see a long lasting price impulse from here, it may be just a 1-2 days bounce and then it may correct again. 

2) Frequency Distribution Analysis:  ZSL is in the middle of the most frequent LONG reversal area: 32.22 to 29.56. Yesterdays' Close was at 30.32, if today ZSL opens down, anything around the 29.56 level is a BUY.

3) RL Trades:  Go LONG today on any negative price below yesterday's Close, and no later than 29.56 (unless ZSL opens with a gap down below 29.56, in which case we recommend you to buy the gap). The 29.56 level has 84.78% odds and in any case the odds between the 31.20 and the 29.56 level are > 64.18%.
If you enter the trade around 29.56, you can use a Stop Loss at 28.68, or you can use Averaging Down Plan, buying more at 26.90  (recommended because the odds are > 75%).

Before using the information contained on this post to trade or invest, please read our DISCLAIMER.

If you have any questions or comments regarding this trading idea, please feel free to contact us.

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Copyright © 2010 - Retracement Levels

Chart on Trina Solar (TSL) by Mike Paulenoff

All of the action in Trina Solar (NYSE: TSL) off of the July high at 22.45 through today's trading has the right look of a mature (read: nearly complete) bullish coil pattern, which if accurate means that the next significant directional move should be to the upside in a thrust out of the coil towards a target zone of 25.00/50.

Only a decline that breaks and sustains below key support at 21.90-21.60 will damage the coil and morph the pattern into a top rather than a bullish continuation.

TSL, which reports tomorrow and may see some earnings-reaction swings, should benefit near-term from UBS's upgrade today of First Solar (FSLR). In addition, after the FSLR upgrade, Collins Stewart noted: "Trina Solar (TSL) remains a top pick in sector... Trina Solar has one of the lowest cost structures in the industry, a strong balance sheet and strong brand. Shares are Buy rated with a $29 price target."

Finally, there is a China connection to my technical preference for TSL, which is based in Changzhou. China energy costs and demand for cleaner sources of fuel argue strongly for a huge presence in solar in and from China. In addition, the technical outperformance of the China market is a theme to my outlook now and in the months ahead.

Originally published on MPTrader.com.