Feb. 5, 2008
RealMoney charts for February 5th.AAPL, FLS, PIR, BAC, SDTH, and ALL
AAPL fell off the tree in early January and continues to get no respect. The trend is decidedly down, and I’d only be holding it if I thought the bulls were making a stand at around $130. And if so, I’d sell on any move below support.
FLS gapped up on Friday and remained strong yesterday, giving back just a fraction of its previous gains. But we’ve got a clear line in the sand now, at around $92 — Friday’s intraday low. If the stock falls below that level, it could fall back to test the breakout…which is something I wouldn’t want to ride through. As far as upside potential, seems to me that a lot of sellers will be lurking at $100. With this type of risk/reward, I’d just close the trade now and find something better.
PIR broke out of a volatility squeeze in late January and is now consolidating the recent gains. Notice how the current trading range is right around the October high. The longer that churning takes place, the more shares trade hands and thus raise the average cost basis of short-term shareholders to current levels. That minimizes the potential for aggressive profit taking and could clear the way for more gains. (But with that said, I was in a Pier 1 store the other night — not a soul in there except the employees).
BAC broke decisively above the 50-day moving average on heavy volume and is now close to prior resistance. If you’re thinking about buying now…why not re-think that move? BAC is due for a rest, and the 50-day moving average is due for a test. I’d be a buyer on the test.
SDTH is trading in a very broad uptrending channel. The stock is closer to that resistance line than it is to support. At the same time, the stock is bumping up against the early January high of $14. That makes for some tough slogging by the bulls. While the uptrend is undeniable, I think a more disciplined entry would be around $12.
This monthly chart of ALL shows a stock that topped out in late 2006 and has been on the decline ever since. With the stock now back down to the 2005-06 lows, I’d watch the current level carefully. Any further weakness completes the top and sets the stage for another $10 – $15 decline.
Be careful out there.