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.