Check out this volatility squeeze on Sprint (S). (March 28, 2013)
S
I’m Dan Fitzpatrick at StockMarketMentor.com on the last weekend in March, and this is the Chart of the Day. Just a real quick one here because this is an opportunity I want to show you; Sprint ( $S Sprint Nextel Corporation ). The stocks in a volatility squeeze, you can see that it’s been trading sideways for quite a while, and if you zoom in a bit you can see that these Bollinger Bands are pretty tight. The Bollinger Bands are standard deviations, they’re two standard deviations above, two standard deviations below the twenty period moving average; that’s the blue line here. When the twenty period moving average is relatively flat then the longer it’s flat the tighter these Bollinger Bands get to reflect this tightness. Anyway, what happens is ultimately the stock breaks out either upside or downside, you don’t really know which way, but in a bull market you kind of expect it to break out to the upside, so that’s really what’s happened with Sprint ( $S Sprint Nextel Corporation ) here; it broke out on the 19th and then it’s consolidated for several days. Well now it’s moving higher again. So this is a real easy analysis here. I don’t think it’s too late to buy Sprint ( $S Sprint Nextel Corporation ); it would have been nice to have bought it down here around $5.93 or even $6.00, something like that, but it looks to me like this stock is poised to go higher, so I would stay long. Okay members get over to the Weekend Update; I’ve got three videos for you, one of them that covers a lot of the IBD 50 stocks many of which are actually looking pretty interesting, so get over there now. Free Chart