BRCM, ARBA, ITWO, NEWP, BRCD, EPNY, AETH...etc. a recurring theme for the last 6 weeks, stocks are taking out key support levels and with high multiples and lower price growth.. like adding Nitro with Glycerine.. by themselves they are not dangerous.
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ITWO - I2 TECHNOLOGIES INC Price= 116.2
Love to short 'ya baby... P/E moving down a bit.. from 269 to 179 now but its still too high to warrant this price. "Valuation Can't Divorce itself From Fundamentals".. It is priced too high compared with the average multiple in its sector and I would be considering shorting ITWO after any rally off key moving averages. ITWO looking for a short 114, to 100 and than 75 before the next earning season. It might even move down more significantly right at the the shortfall period in about 4 weeks. ITWO moved down on the 15 minute chart and the -DX crossed over the plus, ADX triggered a sell as it hit 30 (on the 15-minute chart).
If the market does move up on Wednesday, ITWO might get pulled into a bearish flag daytrade on the long side and then a short play might be set up at a SPIKE HIGH and next bar move to the downside similar to the chart patterns on Tuesday morning.
ARBA - ARIBA INC Price= 72.3
ARBA is in a Strong downtrend. It is likely to reverse and set itself up as a short play. If it does manage to move up it would break resistance at 73 3/4. Slight upturn in RSI but all indicators still bearish.
AETH - Aether Systems Price 67.38
AETH dropped 1 3/4 on Monday to close at 67 3/8 after hitting an intraday high of 75. AETH has been a more or less continuing short play. A buy signal would be given on a break above minor resistance is at 69 1/4 with more major resistance at 74. All moving averages are sloping downwards and bearish. Short term indicators are showing a strong downtrend: daily MACD and stochastics are still oversold. The positive directional indicator is moving down to 14. Another short signal will set up if AETH moves below 65. The next support level is 61 1/2 and half with the next level at 55.. and there is where AETH can fall if prior levels of support is taken out.
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NEWP - Newport Corporation Price=63.06
NEWP is now in a strong downtrend. However we cannot forget that the relative strength of this stock for the year is still at 99 although in the last few weeks the short term relative strength is very low (negative). EPS rank is a hefty 97 although the P/E is still 120, it has fallen quite a bit already. Earnings are still growing in the triple digits every quarter compared to the same quarter last year. We'll give NEWP one last ditch effort to take out 65, which is the next level of resistance.. If it moves below 61, a new 13 week low, it will be a continuing short play. The next support level after 61 is 58 and then 53. What happens after that? ....freefall
we gave NEWP a chance and when it took out 65 it triggered and moved to 70 so NEWP is still a chance for a long play.. especially as it is holding its own in a down market.
EPNY = E. PIPHANY 48.63
EPNY has been trending lower since it failed to take out a double top of 68 1/2 on November 6. For EPNY both daily and weekly charts show weakness, daily and weekly MACD and stochastics have turned down. Short and long term sell, or sell short signals would be given on a break below support at 46 1/2, with the next downside support after a break at 38. Resistance is at 50 and that will be a short term buy signal until the next resistance level of 51 15/16 which would be the 50 day moving average.
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ELNT ELantec Semiconductor Price = 63 7/8
ELNT jumped 6 1/8 on Friday to close at 63 7/8 after hitting an intraday high of 64 1/8 . Resistance is at 62.67, its 200 day moving average. This 200 day moving average is notorious for stopping rally attempts. Short term indicators are improving: daily RSI and stochastics are still oversold daily OBV has turned up and the positive directional indicator is starting to turn up as well. A buy signal would be given on a break above 64 1/4.
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TIBX - Tibco Software Price= 49
TIBX jumped 4 7/8 on Friday to close at 49 after reaching an intraday high of 49 3/4. Short term and intermediate indicators are pointing to a strong downtrend: and it is unlikely any rally will have legs. Stochastics are in oversold territory but turned up on Friday, and daily OBV has turned up. A buy signal would be given on a continued moved above 49 3/4 with the next resistance coming at 40. If TIBX retreats a sell short will be triggered at 47 7/8 for a possible retest of the some prior lows of 40 and could lead to another freefall if all support is taken out.
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BRCD Brocade Communications Price = 189 15/32
BRCD jumped 7 31/32 on Friday to close at 189 15/32 after reaching an intraday high of 191. . Short term and intermediate indicators are pointing to a dominating downtrend: Stochastics are in oversold territory, and daily OBV has turned up. A buy signal would be given on a continued moved above 191 with the next resistance coming at 213. If BRCD retreats a sell short will be triggered at 185 3/16 for a possible retest of the 200 day moving average at 176 and could lead to another freefall on a selloff pending earnings.
marketgems.com
Even if they stay up a bit, they capitulate in the end |
