Charts of the Week, Monday February 5th, 2007
Charts of the Week are stocks that appear to be attractive candidates for short- to intermediate-term (2-6 weeks) returns based on analysis of their daily or weekly chart formations and underlying technicals. Support levels may be used as possible stops.
Analysis: DMRC: DMRC had a very important high-volume breakout late last week of 4-year resistance near the 10 level. The breakout came on strong volume, and completed a basing pattern that had been in existence for more than two years. Overhead resistance levels at 14, 17, 20 and 25 can be considered targets for the short, intermediate and longer-term. Any pullback towards that 10 support area, particularly on low volume, in a flagging/consolidation-type action could be a buying opportunity. Beneath that support exists around 8
Analysis: SCUR: SCUR had a big breakaway gap with extremely heavy volume on Friday on an excellent earnings report. The stock had been building a base in the form of a 6-month narrowing coil-type pattern, with resistance up around the July 2006 gap, which was immediately filled with a large gap of its own on Friday. Long-term overhead resistance over the last couple years is at about the 10-10
Analysis: HTI: This junior biotech tech stock had a huge gap and then a high-volume breakaway run that saw it move from under 3 to just under 9, nearly tripling in a couple weeks. Over the last 6 weeks or so the stock has been forming a flag or pennant-type pattern, with volume recently very low and underlying technicals holding up well. On the Friday the stock began to pick up a bit and may be beginning a move here, but we'll keep close tabs on it for a breakout. Key resistance exists around the 8.10-.15 zone, and any move through that on any kind of heavy volume should attack and take out the 8.70 high from the December rally. Drawing a parallel channel, I can forecast the intermediate target somewhere in the 14 level, with a 10 target short-term. The longer-term target may be projected in the high teens or possibly higher. Short-term support is at the bottom of the pattern around the lows hit near 6
Analysis: ANAD: This is a stock we've been following for quite a while and considered highlighting in the low single digits, but it didn't meet some of our criteria at that time back in 2005. ANAD has had a tremendous run in the last 18 months, moving from 1.25 to as high as 10.38. ANAD has a long-term resistance level around the 10.25-.35 zone, which has thwarted a couple rallies over the last 60 days. But the stock is currently testing that level again and bounced off its long-term uptrend line and bottom of its long-term, two-year up-channel last week. Price projection, once the 10.38 level is taken out, is 14, 20 and 25 short, intermediate and longer-term. Current price support exists at the Dec-Jan lows around the 8
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