ROSG: Huge Upside Potential?

Company Descripttion
Rosetta Genomics Ltd. (Rosetta) develops and commercializes diagnostic tests based on microRNAs. The Company has a clinical laboratory improvement amendment (CLIA)-certified laboratory in Philadelphia, which enables Rosetta to develop, validate and commercialize its own diagnostic tests applying its microRNA technology. On February 4, 2010, the Company established Rosetta Green Ltd. (Rosetta Green) as a controlled subsidiary. As of December 31, 2010, it owned approximately 76.2% of interests in Rosetta Green. The Company’s wholly owned subsidiary, Rosetta Genomics Inc., serves as its agent for service of process in the United States. In December 2010, Rosetta launched its fourth product miRview mets2. Using Rosetta’s intellectual property, collaborative relationships with commercial enterprises and academic and medical institutions, it has initiated microRNA-based diagnostic programs for various cancers.


Faizan's Take
ROSG last closed at $11.95 a share, its chart has taken up a very interesting form which I have rarely seen in the stock market. Technical analysis shows that the stock is possibly positioning itself for a huge upward move. 
Some points to note are:


1. ROSG successfully broke above the 50 day MA and the 200 day MA on immense upside volume. The fact that this has happened after more than three years of trading makes this breakout potent.
2. RSI line has moved up in the positive region.
3. A golden cross of the moving averages is forming after several years of trading.
4.  The stock has made a huge move recently. In the last two months it has increased in value by about 300%.
5. Finally, the stock has broken above the Ichimoku cloud after several deliberations as shown in the image below.

All these signals combined are signalling that ROSG might be skyrocketing pretty soon. However, I must also note that ROSG is a very high risk stock.


How risky?
Let me clarify that this pick is only for aggressive high risk investors. Therefore if you are looking for a small but guaranteed trickle of upward moves than this is not for you. This stock is the kind that can double in value overnight and can also fall to half of its worth overnight.
Just like any bio med company ROSG's stock is highly sensitive to news about its products and therefore even a small punch can throw its price back to the ground. The probability of such a thing happening might be low however, I will still warn investors to understand this risk before jumping in.


Trade plan
I recommend assigning ROSG a very small portion of your portfolio. Small enough so that even if ROSG takes a downturn it won't hurt your overall performance, but size-able enough so that if it skyrockets you can make decent money.
Selling points for ROSG can vary depending on your preference. Just to point out there are small resistances at $20 and $30 and a major one at $70. For more risk averse people maybe a $20 target will suffice. 


Hope you enjoyed reading. Feel free to leave any questions or comments below the post.

Theragenics Corp. (TGX)

Company Description

Theragenics Corporation is a medical device company serving the surgical products and cancer treatment markets. The Company operates in two segments: the surgical products segment and the brachytherapy seed segment. Its surgical products business manufactures, markets and sells disposable devices primarily utilized in certain surgical procedures. Its brachytherapy seed business manufactures, markets and sells radioactive seeds primarily utilized in the treatment of early stage prostate cancer. The Company designs, manufactures, assembles, packages and distributes its surgical products in three primary production facilities, each of which manufactures different products. The product lines in its surgical products business include Sutures, Needles and Brachytherapy Accessories, Guidewires, Micro-Introducer Kits, Orthopedic Needles, Pain Management Needles and Access Needles. Effective February 17, 2012, the Company purchased Core Oncology's prostate brachytherapy customer base.

Faizan's take

TGX last closed at $2.01 a share. The stock is flashing some very interesting technical signals. All these signals are marked on the chart above. Before I go into the details of these signals let me just briefly mention that technical analysis is handicapped in the sense that it can just provide us with stocks that have a high probability of moving up and cannot categorically guarantee us an upward move. Keeping that in mind this stock is  a classical example of "Stan Weinstein's triple confirmation pattern" which is known to uncover exceptional winners. 

Triple Confirmation Pattern

So  this is how the triple confirmation pattern works:  In addition to the basic requirements of the price being above both the 50 day and 200 day moving averages, three signals have to flash on a chart in close proximity to each other. These three signals are as follows:

1. For the past several months the RSI of the stock should be "hugging" the center line and then on the day the breakout occurs the RSI should move sharply and decisively into positive territory. This can be observed clearly on the chart above where after the initial breakout in late May the RSI sharply moved above the center line and has remained there since.

2.  The volume surge on the day of breakout should be immense and by immense I mean more than ten times the average daily volume of past several months. This can also be clearly observed for TGX. The volume surge on the day of breakout was more than 10 times the average volume of past several months.

3. While in the in the base region before breakout the stock should be making huge swing i.e. the stock should be gaining and dropping 25% to 50% of its value in the base region swings. In this case it can be seen that the minimum TGX reached in the base region was roughly $1.35 in February this year and the max it has hit is around $1.90. Which means that stock has been moving more than 30% of its value in the base region. With that all three requirements of the triple confirmation pattern have been confirmed.

In addition to this pattern being confirmed it can also be observed from the Chaikin money flow indicator that for  the past several months a lot of money has been flowing into the stock which is always a good sign.

So there you have it! TGX is apparently poised for a huge move up. Now is a good time to add positions to this stock. It is likely that the stock will retrace its recent upward move to its last support i.e. $1.95. So if that happens you can use that pullback as an opportunity to add more positions. In case the stock never pulls back you can still ride the upward run on your initial position. 

Also, it is important to remember that the "triple confirmation  pattern" is not for short term investors. Don't buy this stock if you are not willing to hold it for at least a couple of months. 

When to sell?

I try my best to avoid giving recommendations on sell points. However, I will point out that there is a small resistance at $2.30. The stock might stumble at this resistance a bit or it might just shoot past it. Use your own intuition and research to find a good sell point.

When to cut your losses?

There is an old saying in technical analysis "Cut you losers, and let your winners run". As I said before there is always a chance that the stock might not move the way you expect it to move. If that happens I would recommend selling all your positions when the stock goes below $1.85 a share. Never ever stick with your losers. Nobody makes money on every single stock they buy, you have to have a system that can make money in the long run. 

Conclusion

With all that being said I believe that it is highly likely that TGX will go for a good bull run. Hope you guys enjoyed reading. Please feel free to leave comments or questions below this post.

Fluor Corporation (FLR)

Company Description
Fluor Corporation (Fluor) is a holding company. It is a professional services company providing engineering, procurement, construction and maintenance, as well as project management services on a global basis. Fluor serves a diverse set of industries worldwide, including oil and gas, chemicals and petrochemicals, transportation, mining and metals, power, life sciences and manufacturing. It is also a primary service provider to the United Services federal government. Fluor operates in five principal segments: Oil & Gas, Industrial & Infrastructure, Government, Global Services and Power. Fluor Constructors International, Inc., which is organized and operates separately from the rest of its business, provides management and construction services in the United States and Canada, both independently and as a subcontractor on projects in each of its segments. In November 2011, it acquired a sulfur technology company, Goar, Allison & Associates, a unit of Air Products.


Faizan's take
For a hold period of around 6 months I anticipate the price reaching $74.00 a share which should give a decent 21% gain.

Estee Lauder Companies Inc. (EL)

Company Description
The Estee Lauder Companies Inc. is a manufacturer and marketer of skin care, makeup, fragrance and hair care products. Its products are sold in over 150 countries and territories under a number of brand names, including Estee Lauder, Aramis, Clinique, Origins, M.A.C, Bobbi Brown, La Mer and Aveda. It is also the global licensee for fragrances and/or cosmetics sold under brand names, such as Tommy Hilfiger, Donna Karan, Michael Kors, Sean John and Coach. These channels include over 30,000 points of sale, consisting of department stores, specialty retailers, upscale perfumeries and pharmacies and prestige salons and spas. In addition, its products are sold in freestanding Company-operated stores, its own and authorized retailer Websites, stores on cruise ships, direct response television, in-flight and duty-free shops and certain fragrances are sold in self-select outlets. During the fiscal year ended June 30, 2011, it acquired the license to develop Ermenegildo Zegna products.


Faizan's take
EL last traded at $101.70 a share. The stock has good upward momentum which I anticipate will continue for a few more months at the least.
Price target $117.00 (15% gain).

Regeneron Pharmaceuticals, Inc. (REGN)

Company Description
Regeneron Pharmaceuticals, Inc. (Regeneron) is a biopharmaceutical company. Regeneron discovers, develops, and commercializes pharmaceutical products for the treatment of serious medical conditions. As of December 31, 2010, the Company had one marketed product: ARCALYST (rilonacept) injection for subcutaneous use, which is available for prescription in the United States for the treatment of Cryopyrin-Associated Periodic Syndromes (CAPS), including Familial Cold Auto-inflammatory Syndrome (FCAS) and Muckle-Wells Syndrome (MWS) in adults and children 12 and older. Its late stage programs are VEGF Trap-Eye (aflibercept ophthalmic solution), which is being developed for the prevention and treatment of serious eye diseases; ARCALYST, which is being developed for the prevention of gout flares in patients initiating uric acid-lowering treatment, and aflibercept (VEGF Trap), which is being developed in oncology in collaboration with the sanofi-aventis Group.


Faizan's take
REGN closed at $65.2 a share on Friday. This stock has a lot of momentum  on its side, and can make a decent up move in the next couple of months.
Price target $74 (12.8% gain).


NOTE: Suggested price targets are very flexible and may change as the price action unfolds. Targets are only suggested to give readers a rough estimate of what to expect from the stock and they should not be used by investors as absolute sell points.

Mastercard (MA)

Company Description
MasterCard Incorporated (MasterCard) is a global payments company that provides a economic link among financial institutions, businesses, merchants, cardholders and governments worldwide, enabling them to use electronic forms of payment instead of cash and checks. The Company provides a variety of services in support of the credit, debit, prepaid and related payment programs of approximately 22,000 financial institutions and other entities that are its customers. The Company offers payment solutions, which enable its customers to develop and implement credit, debit, prepaid and related payment programs for their customers, which include cardholders, businesses and government entities. MasterCard manages a family of payment card brands, including MasterCard MasterCard, Maestro and Cirrus, which the Company license to its customers. MasterCard generates revenue by charging fees to its customers for providing transaction processing and other payment-related services.


Faizan's take
Mastercard (MA) last traded at $339.10 a share. The stock looks technically sound. Just today it broke an ascending triangle formation on good volume, indicating a bull run in the near mid term.
Suggested price target $384.00 (13.2% gain).


NOTE: Suggested price targets are very flexible and may change as the price action unfolds. Targets are only suggested to give readers a rough estimate of what to expect from the stock and they should not be used by investors as absolute sell points.

Silver Wheaton Corporation (SLW)

Company Description
Silver Wheaton Corp. (Silver Wheaton) is a mining company, which generates its revenue primarily from the sale of silver. As of December 31, 2010, Silver Wheaton had entered into 14 long-term silver purchase agreements and two long-term precious metal purchase agreements. The Company operates in nine business segments: the silver produced by the San Dimas, Zinkgruvan, Yauliyacu, Penasquito, Cozamin, Barrick and Other mines, the gold produced by the Minto mine and corporate operations. Its wholly owned subsidiaries include Silver Wheaton (Caymans) Ltd. and Silverstone Resources (Barbados) Corp. In December 2010, Silver Wheaton sold its La Negra silver interest to Aurcana Corporation (Aurcana). On May 21, 2010, the Company acquired Ventana Gold Corp. (Ventana). On November 3, 2010, it acquired Bear Creek Mining Corporation (Bear Creek).


Faizan's take
On Friday SLW closed at $40.71. Its chart pattern is demonstrating good technical health. I expect this stock to continue its upward move during the next 6 -12 month period.
Suggested price target $48.00 (17.9% gain).


NOTE: Suggested price targets are very flexible and may change as the price action unfolds. Targets are only suggested to give readers a rough estimate of what to expect from the stock and they should not be used by investors as absolute sell points 

Cepheid Inc. (CPHD)

Company Description
Cepheid, a molecular diagnostics company, develops, manufactures, and markets integrated systems for testing in the clinical market, as well as for application in its biothreat, industrial, and partner markets. The company’s systems enable molecular testing for organisms and genetic-based diseases by automating otherwise complex manual laboratory procedures. The company’s systems integrate these steps and analyze complex biological samples in its proprietary test cartridges.


Faizan's take
CPHD traded at $31.13 a share on Monday's close. Its chart is showing a perfectly formed head and shoulder topping pattern. Shorting CPHD today might yield a good profit in the near mid term.
Suggested price target $28.55 (8.3% gain).


NOTE: Suggested price targets are very flexible and may change as the price action unfolds. Targets are only suggested to give readers a rough estimate of what to expect from the stock and they should not be used by investors as absolute sell points.

Lentuo International Inc. (LAS)

Company Description
Lentuo International Inc. is a holding company. The Company is a non-state-owned automobile retailer in Beijing, the People's Republic of China. As of June 30, 2010, it operated six franchise dealerships, 10 automobile showrooms, one automobile repair shop and one car leasing company in the Beijing metropolitan area. It provides a one-stop shop experience for its customers by offering them a range of automobile products and services in each of its franchise dealerships (4S dealerships). 4S stands for sales, spare parts, services and survey, and its dealerships offer a range of automobile retail services. The Company offers passenger vehicles, auto parts and accessories for sale, as well as automobile repair and maintenance services, and provide a channel for vehicle manufacturers to gather customer feedback.


Faizan's take
LAS last closed at $5.68 a share. The chart is demonstrating good technicals and the stock may give a decent profit within the next 6 months.
Suggested price target $6.89 (21% gain).


NOTE: Suggested price targets are very flexible and may change as the price action unfolds. Targets are only suggested to give readers a rough estimate of what to expect from the stock and they should not be used by investors as absolute sell points.

Corinthian Colleges Inc. (COCO)

Company Description
Corinthian Colleges, Inc. (Corinthian) is a post-secondary education company in the United States and Canada, serving the segment of the population seeking to acquire career-oriented education. As of June 30, 2010, the Company had a student enrollment of 110,580 and operated 101 schools in 25 states, and 17 schools in the province of Ontario, Canada. As of August 13, 2010 all of its schools operated under one of three national brands, Everest, WyoTech, or Heald. As of June 30, 2010, 101 out of 118 schools were operating under the Everest brand, six schools were operating under the WyoTech brand, and 11 schools were operating under the Heald brand. The Company offers a variety of diploma programs and associate's, bachelors and master's degrees through a single operating segment. Its training program areas include healthcare, criminal justice, mechanical, trades, business and information technology. On January 4, 2010, the Company completed its acquisition of Heald Capital, LLC.


Faizan's take
Corinthian Colleges Inc. (COCO) yesterday closed at $5.06 a share. My analysis of this stock shows that after a one year long downtrend now might be the time when COCO starts moving up. It can be expected to a fair degree of confidence that a good upward trend will be established soon and will continue for a few months.
Suggested price target $6.97 (37% gain).


NOTE: Suggested price targets are very flexible and may change as the price action unfolds. Targets are only suggested to give readers a rough estimate of what to expect from the stock and they should not be used by investors as absolute sell points.

Orexigen Therapeutics, Inc. (OREX)

Company Description
Orexigen Therapeutics, Inc. is a biopharmaceutical company focused on the development of pharmaceutical product candidates for the treatment of obesity. The company's lead combination product candidates targeted for obesity are Contrave, which is in Phase III clinical trials, and Empatic, which is in the later stages of Phase II clinical development. Each of these product candidates is a combination of generic drugs, which it has systematically screened for synergistic central nervous system, or CNS, activity. Each of the components of its product candidates has already received regulatory approval and has been commercialized previously.


Faizan's take
OREX last closed at $3.34 a share. Recently it broke out of a well formed symmetric triangle. It has potential to give a decent profit within the next year.
Suggested price target $4.47 (34% gain).


NOTE: Suggested price targets are very flexible and may change as the price action unfolds. Targets are only suggested to give readers a rough estimate of what to expect from the stock and they should not be used by investors as absolute sell points 

Agilysys Inc. (AGYS)

"UPDATE: As of 1st June 2011 I will just name my picks with a little company information. Background technical analysis for each stock will not be provided anymore. This is because writing detailed technical analysis is very time consuming which my busy schedule does not allow. 

Instead I will like to promote discussions in the comments section and would like to listen to your take on the recommended picks.

However, if you still want the background analysis feel free to ask in the comments section or through email."

Company Description

Agilysys, Inc. is a leading provider of innovative IT solutions to corporate and public-sector customers, with special expertise in select markets, including retail and hospitality. The company develops technology solutions — including hardware, software and services — to help customers resolve their most complicated IT needs. The company possesses expertise in enterprise architecture and high availability, infrastructure optimization, storage and resource management, and business continuity, and provides industry-specific software, services and expertise to the retail and hospitality markets. Headquartered in Solon, Ohio, Agilysys operates extensively throughout North America, with additional sales offices in the United Kingdom and in Asia. Agilysys has three reportable segments: Hospitality Solutions Group (“HSG”), Retail Solutions Group (“RSG”), and Technology Solutions Group (“TSG”). 

Faizan's take

Currently trading at $6.81 a share AGYS has potential to leap upto 20% in value over the next 6 months or so. Suggested price target is $8.29 (21% gain).

NOTE: Suggested price targets are very flexible and may change as the price action unfolds. Targets are only suggested to give readers a rough estimate of what to expect from the stock and they should not be used by investors as absolute sell points.  

Companhia de Bebidas das Americas ADS (ABV)

"UPDATE: As of 1st June 2011 I will just name my picks with a little company information. Background technical analysis for each stock will not be provided anymore. This is because writing detailed technical analysis is very time consuming which my busy schedule does not allow. 

Instead I will like to promote discussions in the comments section and would like to listen to your take on the recommended picks.

However, if you still want the background analysis feel free to ask in the comments section or through email. "

Company Description
Companhia de Bebidas das Américas—AmBev is the successor of Companhia Cervejaria Brahma (“Brahma”) and Companhia Antarctica Paulista Indústria Brasileira de Bebidas e Conexos (“Antarctica”), two of the oldest brewers in Brazil. Antarctica was founded in 1885. Brahma was founded in 1888 as Villiger & Cia. The Brahma brand was registered on September 6, 1888, and in 1904 Villiger & Cia. changed its name to Companhia Cervejaria Brahma. AmBev, a Brazilian sociedade anônima, was incorporated as Aditus Participações S.A. (“Aditus”) on September 14, 1998. AmBev is a publicly held corporation incorporated under the laws of the Federative Republic of Brazil.


Faizan's take

ABV currently at $31.54 is demonstrating very good technicals and can give a decent profit in the upcoming months. Suggested price target is $33.89 (7.5% increase).

NOTE: Suggested price targets are very flexible and may change as the price action unfolds. Targets are only suggested to give readers a rough estimate of what to expect from the stock and they should not be used by investors as absolute sell points. 

Interphase Corp. (INPH)

Interphase Corp. (INPH) is a technology company which specializes in computer peripherals. As of now it is trading at $5.20 a share. Interesting formations are appearing on INPH's chart which I would like to point out.

The following chart is a daily chart for INPH with an Ichimoku cloud overlay.

First thing to notice on this chart is that starting May 2009 INPH established a continuous downtrend which finally lasted in November 2010. During this 19 month time period the stock lost more than 80% of its value. At that time the stock was highly oversold, and was ready for a good upthrust.
Then, starting December 2010 the stock made some rapid upward moves and after about 1.5 years it finally broke above  the Ichimoku cloud on incredibly high volume. Supporting this increase was a sharp uptrend in the stock's RSI which is a very bullish indicator. Also, at the tip of this uptrend the stock broke a very significant resistance level at $6.00 leaving no overhead resistance on this 3 year chart. This clearly shows that the current tape formation for this chart is very healthy and we can expect a continued upward trend for the near short term.

Now lets look at another chart for INPH.

This is a one year daily chart without the Ichimoku overlay. On this chart we can see that after the recent high at around $6.50 the stock is now trading in a narrow symmetric range. A breakout above this range will indicate another bullish run, while a breakdown would mean a correction. So this chart is worth keeping an eye on as well.
Also, notice that recently the 50 day and the 200 day moving averages crossed over indicating a bull. Combined with that the Chaikin Money Flow indicator shows that the stock has remained above the crucial zero line for most of the last six months indicating that the stock is fueled up now and is ready for a ride. (For more on volume indicators read The Trader's Book of Volume: The Definitive Guide to Volume Trading).
Finally to decide on good sell points we shall take a look at the following all data chart for INPH.

It can be seen from this chart that the next resistance level(from 2007) is around $9.00-$10.00. So, this can be a good sell point for mid term traders. This is just a casual advice. Rely on your own intellect to choose a sell point, because finding a good sell point is more of an art than science.

(Being a pure technician I usually avoid listening to news about stocks. But going against my own beliefs I would like to throw in one: Interphase Corp's directors Strunk Christopher, and Myers Michael collectively purchased 9000 shares of INPH on 15th and 18th February.)

So to sum up I believe INPH is presenting an excellent buy opportunity, provided that the stock breaks above the narrow trading range (which may take a few weeks). That's all I have for now. Don't forget to subscribe for feeds. Have a great weekend!

RightNow Technologies Inc. (RNOW)

RightNow Technologies Inc. is a "Technology" company which last traded at $23.68 a share. RNOW's charts are showing excellent bullish formations. First we will analyze the weekly chart for RNOW.

It can be seen that RNOW broke out of significant resistance $20.00 in early October. This breakout was accompanied by huge trading volume during the week of breakout. Subsequently RNOW maintained a bullish run till it reached $28.00 a share in late October, and then started to make an apparently short term correction. This correction continued till late December and the stock briefly reached a low of $18.80 this week. But, now I think this correction is over and the stock is ready for another bullish run.

A view at the StochRSI for RNOW (see chart above) demonstrates that the recent correction has put the stock in an oversold position, and now an upward move is long due. (For more on StochRSI read The New Technical Trader: Boost Your Profit by Plugging into the Latest Indicators (Wiley Finance)). Some other significant features of RNOW's weekly chart are:
1. The most recent low at $18.80 touched the 50 week moving average and then jumped up sharply. This clearly shows that the support provided by the moving average is pretty strong, and the  stock is unlikely to defy this support in the near future.
2. Also it can be seen from the chart above that after the breakout in October the stock made a correction on "drying up" volume. This is a very bullish signal and confirms that the stock is still in an uptrend. Also, after touching the moving average the stock jumped up on huge volume which is another bullish signal.

Now lets look at the "all data" chart for RNOW.

The above chart gives a comprehensive look at RNOW's complete trading history. It can be seen that RNOW started trading in 2004, and since then it has attempted several times to defy resistance at $20.00. All these attempts are marked with a blue circle in the chart above. However just recently in October after more than 6 years of trading the stock finally broke out of $20.00 a share (shown by green circle on chart): leaving no overhead resistance for the stock at all. This means that the stock is "lighter" now and can make rapid advances more easily.
The recent downtrend I believe is only a short term correction and the stock will be back on a bullish track in 2011.

Combining all the above mentioned factors I believe that RNOW is capable of making immense bullish moves in 2011, and can potentially give a profit of 20% to 50%. For short to medium term investors a good sell point can be the most recent high at $28.00 a share, and for long term investors the sell point can be even higher.

That's all I have for today. Don't forget to subscribe for regular feeds. Hope you have a Great New Year!

Flotek Industries Inc. (FTK)

Flotek Industries Inc. is a basic materials company. This sector is currently in a very bullish uptrend (take a look at my previous pick: Dynamic Materials Corp. for an analysis of this sector). To analyze this stock I am using an Ichimoku overlay on FTK's weekly chart as shown below.

NOTE: For details on Ichimoku Charts read Ichimoku Charts: An Introduction to Ichimoku Kinko Clouds.

FTK closed at $4.25 a share on Tuesday, December 28th. On the chart shown above I have marked four regions where strong bullish formations are appearing.
Region 1: In early November FTK's price moved decisively above both the conversion line(blue) and the base line(red). Also, during the same week after almost 3 years of trading the stock broke above the Ichimoku cloud. This is a very bullish signal, especially if the breakout occurs after a long period as in FTK's case.
Region 2: Since the cloud is shifted 26 days, it provides a glimpse of future trends. On the chart above it can be seen that the cloud turns from red to green indicating bullish moves in the future.
Region 3: This part is really important. It can be seen that all the above mentioned technical formations were supported by huge trading volumes. High amounts of volume makes breakouts more reliable.
Region 4: Finally the sharp upward turn in the stock's RSI is a strong indication of rapid bullish progress for the stock in the future.

FTK's daily chart is also showing some interesting formations.
Notice after the most recent upward rally, the stock is now trading in a narrow symmetric trading range. A breakout above this range will mean another bullish run. While a breakdown will indicate a short term correction. So, the daily chart is also worth keeping an eye on.

To sum up I think FTK is presenting a good long term investment for a hold period of six months to two years. Good sell points can be past resistances and supports around $10.00 and $15.00. This can give a decent 100% to 200% profit.


NOTE: One of my previous picks Geeknet Inc. (GKNT) is up 25% in just over a month. This can be a good sell point for short term traders.

That's it for today. Don't forget to subscribe for regular feeds.

Dynamic Materials Corp. (BOOM)

Dynamic Materials Corp. last traded at $23.87 a share. The stock's current chart formation is flashing some classic break out signals. BOOM falls under the basic materials sector which has more than 90% stocks classified as "bullish". A look at the current chart for "$BPMATE" shows this clearly.

Therefore, it is unlikely that in the near term the stocks in this sector will establish downtrends. Sector analysis is fundamental to charting. As a rule of thumb investors should always zoom in on stocks by first performing a thorough market and sector analysis.

(NOTE: For this stock I will only analyze the weekly chart and not the daily chart. This is because we are looking for mid to long term investing in this stock. Also, the formations on the weekly chart are so powerful for this stock that they render the daily chart formations insignificant.)
Now lets look at the weekly chart for BOOM, which is showing some remarkable breakout signals.

First, this week the stock broke out of an 18 month old resistance at $23.00 a share. Fueling this breakout was huge volume surge during the last two weeks. This signifies a possible sustained rally in the near term future.

Second, The Relative Strength Index (RSI) for the stock is also showing an amazing bullish formation. Notice that the RSI was hugging the zero line for more than 18 months until last week when it made a sharp turn to the upside. This as I said before is a very bullish formation and should never be overlooked by seasoned chartists.

Finally, notice that since the last low at around $14.00 a share, the stock has increased more than 40% in value. This confirms the stock's ability to make huge consistent moves.

After the current rally there is a possibility that the stock might consolidate or make a correction over the next few weeks. But, I would advise not to wait for a pullback because sometimes these stocks establish a consistent upward rally (see TOD which showed similar formations back on 8th November and it never pulled back).

I won't be able to recommend a sell point for BOOM, because if it establishes a good uptrend: the sky is the limit. Just rely on your instincts when deciding on a good sell point. If everything goes alright BOOM can give 20%-40% profit over the next couple of months. For long term investors the profits can be even greater for a hold period of 6 months to 1 year.

As always don't forget to subscribe for feeds. Enjoy the Holidays!

Cardiome Pharma Corp. (CRME)

CRME last closed at $6.12 a share on December 10th. Right now the charts are signaling that the stock is a good buy and will outperform the market over the next few weeks.


The chart above is a weekly chart for CRME. Some important features on this chart are:

1. The stock recently touched support at $4.7 (marked with a black line) and then jumped up. Notice that this support used to be a resistance back in 2009 and for the most part of 2009 the stock wasn't able to defy this resistance (despite several attempts). This clearly shows that the support at $4.7 is strong and it is not likely that the stock will break down below this support in the near future.

2. The other thing to notice is that after hitting this support the stock went up like fire. In just last week alone it increased in value by almost 20%. Fueling this jump was a huge volume surge last week as can be seen on the chart. Volume surge indicates that this new potential uptrend is not going to end soon.

3. The stock has been in a sharp downtrend for more than 4 months now; indicating that an upward move is now long due.

Now let's look at the daily chart for CRME. This chart is signaling a good bullish move starting most probably next week. The key points to notice are:

1. The most recent downtrend started on August 9th and continued with lower lows till roughly 9th November. The next low on 5th December was higher than the previous low: indicating that the sellers are no longer in control of the stock.

2. During the downtrend the stock tried to defy its 50 day moving average twice(indicated by purple circles on chart), but failed both times. But, then last week it successfully defied this moving  average(shown by green circles on chart). Also notice that during this breakout the volume increase was huge, signaling a good bullish move is in store ahead.

3. Notice that the RSI for the stock has remained below the zero line for more than 4 months and just last week it made a sharp and decisive move into the positive territory. This is a very strong bullish indicator, it was introduced by Stan Weinstein in his infamous book "Stan Weinstein's Secrets For Profiting in Bull and Bear Markets".

CRME is a very strong buy right now. I believe that it will establish a good uptrend now and within the next month or two it will rise up to $8.0-$8.5 a share giving a 30%-40% profit.
(But, keep note that CRME is a biomedical company and like all biomedical companies it's stock is very sensitive to negative news about its products and therefore understand this risk before buying CRME.)

NOTE: As a follow up to one of my previous picks "Citigroup" on November 26th: I believe that now it is a strong buy for long term investors who are willing to hold it for a period of 6 months to 1 year.

Theravance, Inc. (THRX)

Theravance, Inc. is a bio-pharmaceutical company. It falls under the sector "Healthcare" and industry "Biotechnology". A look at "$BPHEAL" (Healthcare sector bullish percentage index) clearly shows that most of the stocks in this sector are bullish, this means that stocks in this sector are more likely to establish and/or continue an uptrend in the near future. Apart from this the stock's industry "Biotechnology" is also currently in a very strong position (Look at John Murphy's Industry Groups).

Now that we have established that the stock is in a strong sector and industry lets examine the daily and weekly charts for THRX.

The chart above is a daily charts for THRX. I will briefly point out the bullish signals/features on this chart:
1. The stock is trading above both its 50 day and 200 day moving average.
2. On the most recent day of trading (November 29th) the stock broke out of resistance at $23.00, and has no overhead resistance on this daily chart (which shows 6 months of trading).
3. This recent breakout was accompanied by huge volume on the day of breakout.
4. The stock's daily RSI is decisively above the zero line and has remained there for a long time.
5. A recent MACD crossover can be seen on the chart.

Now lets examine the weekly chart for THRX. This chart is showing some really strong bullish signals. I will point them out here:
1. The stock broke out of resistance at $23.00. Last over head resistance is more than three years old (making it insignificant).
2. The RSI for THRX is above the zero line and seems to be in an uptrend.
3. In August 2010 the stock traded at $12.00 a share and since then it has increased more than 100% in just a few months. This is a very important signal, it means that if the stock is to continue an uptrend it will most likely be as rapid as the last one.
4. Lastly, the stock is trading above both 50 week and 200 week moving averages.

You might have noticed that one important bullish signal is missing on the weekly chart i.e. increased volume during breakout week. But, so far the stock has traded just on Monday of the breakout week and on the daily chart we can see that it indeed traded on huge amounts of daily volume. We just have to wait for the other four remaining days of the week to clearly see the increased volume on the weekly chart as well.

I think that THRX is presenting a very good buy opportunity right now; it is in a strong sector and industry, and the technical indicators are signaling that it will most likely have a good bullish run for the next 3-4 months. A good sell point can be $30.00-$35.00 per share, which represent an old trading range for this stock from back in 2007.

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Citigroup, Inc. (C)

Citigroup, Inc. (C) is showing some interesting technical formations both on the daily and weekly charts. Today on 26th November 2010 it closed at $4.11.