Tuesday, October 15, 2013

Alliance Fiber Optic Products Inc. (Nasdaq: AFOP): Get 300% Gains In UHDTV Industry?

They used to call it dark fiber...

It was the 1990s. Telecom firms plowed billions into fiber optic networks to prepare for the coming explosion in traffic for the web, wireless systems, and computer networks.

Turns out, the supposed "gold rush" was just a few years ahead of its time. So, much of the fiber optic systems sat unused. They were quite literally dark - no light, no data, was shining down the high-speed cables.

But quietly over the past few months, the fiber-optic sector has hit critical mass.
It's lit up like never before.

Consider that one small-cap leader has already handed savvy broadband investors gains of nearly 300% over the past year.  (more)

Please share this article

Indicator Warns It May Be Time to Start Preparing for a Bear Market

Markets change character slowly. The transition from a bull market to a bear market takes time to develop as a top forms. By the time the bear market is confirmed, many stocks are already showing losses. To spot potential turning points, technical analysts look at breadth indicators to signal when a large number of stocks are showing losses.

Breadth indicators measure how many individual stocks are moving in the direction of the market trend. In a bull market, we would expect to see most individual stocks moving up. In a bear market, most stocks will fall. As stocks transition between the two phases, breadth provides important clues about what should happen next.

There are a number of ways to measure breadth and many of them are complex. Analyzing breadth usually involves looking for divergences between the indicator and the price action. Divergences occur when the indicator fails to confirm a new high or low in prices. There are a number of ways to define divergences, and most are subject to the assumptions of the analyst.

While breadth can be difficult to interpret, we always try to look at things from the simplest possible perspective. The table below shows how many stocks are in downtrends based on the 200-day simple moving average (SMA):  (more)

Please share this article

Agnico Eagle Mines Ltd (NYSE: AEM)

Agnico-Eagle Mines Limited, through its subsidiaries, engages in the exploration, development, and production of mineral properties in Canada, Finland, and Mexico. It primarily explores for gold, as well as silver, copper, zinc, and lead. The company's flagship property includes the LaRonde Mine located in the Abitibi region of Quebec. As of December 31, 2012, the LaRonde Mine's estimated proven and probable mineral reserves included approximately 4.2 million ounces of gold. It has exploration activities in Canada, Europe, Latin America, and the United States. The company was founded in 1953 and is headquartered in Toronto, Canada.
Please take a look at the 1-year chart of AEM (Agnico-Eagle Mines Limited) below with my added notations:
1-year chart of AEM (Agnico-Eagle Mines Limited) AEM is as simple as TROW was earlier this week. The stock has held a very important level of support at $25 (blue) since June. Regardless of what the market, or gold, has or has not down over that period of time, the stock has yet to break that level. Now, AEM is approaching $25 again and that might provide another bounce higher, but the stock's recent downward move could be setting the stock up for a breakdown.

The Tale of the Tape: AEM has a key level of support at $25. A trader could enter a long position at $25 with a stop placed under the level. If the stock were to break below the support, a short position would be recommended instead.
Please share this article

5 Bullish Chart Set Ups: PNC, COF, JNJ, VZ, PKG

The stock market is getting into the heart of Q3 earnings season.  The calendar is packed between October 14 and 18.  Given the flow of fundamental news, it might be worth taking a look at the technical set up of a few names reporting earnings.  Here are five charts which show promise for future gains.
Johnson and Johnson (JNJ - Analyst Report), Zacks Rank #3 (Hold), releases its earnings report on October 15.  The stock has traded lower in recent weeks and formed a bullish wedge formation.  Prices have been able to hold just above the $85 area.  A move over the recent high just below $91 will confirm a bullish break out and put prices in position to test the recent high near $95.50.  A breach of $85.50 would question the validity of the set up.   The $87.30 area should be a region of support above $85.50.   According to the MACD, price momentum seems to be turning upward. JNJ has beaten the Zacks Consensus Earnings per Share Estimate 10 straight quarters.

(click chart to enlarge)
Packaging Corporation of America (PKG - Snapshot Report), Zacks Rank #3 (hold), reports earnings on October 15.  It has corrected back into support in the $55 area in recent sessions and shows signs of turning higher.  It looks set to rebound into the low $60 area and continue the uptrend.  Movement below the $54 region would question the market’s strength.  The MACD is showing bottoming price momentum and is supportive of a turn higher and resumption of the uptrend.  PKG has beaten the Zacks Consensus Earnings per Share estimate 7 of the past 10 quarters. (more)
Please share this article

Forest Laboratories, Inc. (NYSE: FRX)

Forest Laboratories, Inc. develops, manufactures, and sells branded forms of ethical drug products primarily in the United States and Europe. It principally offers Namenda for the treatment of moderate and severe Alzheimer's disease; Bystolic for the treatment of hypertension; Savella for the management of fibromyalgia; Teflaro for the treatment of adults with skin and skin structure infections, and community-acquired bacterial pneumonia; Daliresp to reduce the risk of chronic obstructive pulmonary disease (COPD) exacerbations in patients with severe COPD; and Viibryd for the treatment of adults with major depressive disorder (MDD). The company has products under new drug application review by Food and Drug Administration comprising Aclidinium for the maintenance treatment of COPD; and Linaclotide for the treatment of constipation-predominant irritable bowel syndrome and chronic constipation.
To review potential trading opportunities with Forest's stock, please take a look at the 1-year chart of FRX (Forest Laboratories, Inc.) below with my added notations:
1-year chart of FRX (Forest Laboratories, Inc.) FRX appears to be forming a double top price pattern (blue) from July until now. Double tops are reversal patterns and are as simple as they sound: Rallying up to a point (T), selling off to a support, and then rallying back up again to approximately the same top (T). As with any price pattern, a confirmation of the pattern is needed. FRX would confirm its pattern by breaking below the $42 support (red) that has been created by the double top pattern.

The Tale of the Tape: FRX could be forming a double top pattern. A long trade could be made at $42 or on a move above $45 (resistance). A short trade could be made on a break of $42, which would confirm the double top.
Please share this article

Daily Market Commentary: Russell 2000 Breakout

On the third day. bulls were finally able to take out the Russell 2000's 'bull trap' created by September's breakout. Technicals improved without taking out the MACD trigger 'sell'.  Those smart enough to have bought the test of channel support will have done well.  Next target is channel resistance.

The other index to have performed well is the semiconductor index. Today's close marked a breakout similar to that of the Russell 2000, although given the more modest climb it's more likely to continue its advance. (more)
Please share this article