HOT TOPICS LIST
- MACD
- Fibonacci
- RSI
- Gann
- ADXR
- Stochastics
- Volume
- Triangles
- Futures
- Cycles
- Volatility
- ZIGZAG
- MESA
- Retracement
- Aroon
INDICATORS LIST
LIST OF TOPICS
PRINT THIS ARTICLE
by Arthur Hill
Choice Point Software bounced off long-term support with a gap. Look for a flag breakout to signal a continuation higher.
Position: Hold
Arthur Hill
Arthur Hill is currently editor of TDTrader.com, a website specializing in trading strategies, sector/industry specific breadth stats and overall technical analysis. He passed the Society of Technical Analysts (STA London) diploma exam with distinction is a Certified Financial Technician (CFTe). Prior to TD Trader, he was the Chief Technical Analyst for Stockcharts.com and the main contributor to the ChartSchool.
PRINT THIS ARTICLE
GAPS
Choice Point Stalls After Gap
02/06/08 08:50:20 AMby Arthur Hill
Choice Point Software bounced off long-term support with a gap. Look for a flag breakout to signal a continuation higher.
Position: Hold
| Figure 1 shows monthly prices going back to 2000. Choice Point (CPS) advanced above 40 in 2002 and then began a long consolidation. The stock forged resistance just below 50 and support around 30. It was basically confined to a 20-point range for six years. With a decline over the last eight months, CPS is once again testing long-term support around 30, and it may be time to look for a bounce. |
|
| FIGURE 1: CPS, MONTHLY. Choice Point advanced above 40 in 2002 and then began a long consolidation. |
| Graphic provided by: TeleChart2007. |
| |
| Figure 2 moves to daily price action and shows a gap off support two weeks ago. This gap is holding and the stock consolidated after the gap. The gap is quite positive, but it is just one day of strength and some follow-through is needed. After the gap, CPS formed a flat flag with resistance at 34 and support at 32.5. These are the levels to watch. A break above flag resistance would signal a continuation higher, while a break below flag support would signal a failure. |
|
| FIGURE 2: CPS, DAILY. Here's a gap off support. The gap is holding and the stock consolidated after the gap. |
| Graphic provided by: TeleChart2007. |
| |
| Volume and on-balance volume (OBV) show strong buying pressure the last two weeks. The black bars show volume on up days and the red bars show volume on down days. Just before the gap, the stock advanced on big volume. The gap also occurred on big volume. There were also a few advancing days with big volume as the flag formed. OBV surged above its November high last week and this shows strong buying pressure. Volume points to a breakout, but we need price confirmation with a break above flag resistance. Traders get paid for price movements, not volume movements. |
Arthur Hill is currently editor of TDTrader.com, a website specializing in trading strategies, sector/industry specific breadth stats and overall technical analysis. He passed the Society of Technical Analysts (STA London) diploma exam with distinction is a Certified Financial Technician (CFTe). Prior to TD Trader, he was the Chief Technical Analyst for Stockcharts.com and the main contributor to the ChartSchool.
| Title: | Editor |
| Company: | TDTrader.com |
| Address: | Willem Geetsstraat 17 |
| Mechelen, B2800 | |
| Phone # for sales: | 3215345465 |
| Website: | www.tdtrader.com |
| E-mail address: | arthurh@tdtrader.com |
Traders' Resource Links | |
| TDTrader.com has not added any product or service information to TRADERS' RESOURCE. | |
Click here for more information about our publications!
Comments
Date: 02/06/08Rank: 2Comment:
|
Request Information From Our Sponsors
- VectorVest, Inc.
- Executive Premier Workshop
- One-Day Options Course
- OptionsPro
- Retirement Income Workshop
- Sure-Fire Trading Systems (VectorVest, Inc.)
- Trading as a Business Workshop
- VectorVest 7 EOD
- VectorVest 7 RealTime/IntraDay
- VectorVest AutoTester
- VectorVest Educational Services
- VectorVest OnLine
- VectorVest Options Analyzer
- VectorVest ProGraphics v6.0
- VectorVest ProTrader 7
- VectorVest RealTime Derby Tool
- VectorVest Simulator
- VectorVest Variator
- VectorVest Watchdog
- StockCharts.com, Inc.
- Candle Patterns
- Candlestick Charting Explained
- Intermarket Technical Analysis
- John Murphy on Chart Analysis
- John Murphy's Chart Pattern Recognition
- John Murphy's Market Message
- MurphyExplainsMarketAnalysis-Intermarket Analysis
- MurphyExplainsMarketAnalysis-Visual Analysis
- StockCharts.com
- Technical Analysis of the Financial Markets
- The Visual Investor