Well FMCN made a nice move today (1.74%), but there was not a lot of trading volume that went into the stock. (click on the image to make it larger) This means that "weak hands" were playing the stock today. "Weak hands" are small investors like you and me who are only pitching in only a few thousand dollars. What one would really like to see is high trading volume with a rise in price. This shows big investors are pumping money into the stock. Still keeping the price target of $61.00. Another factor is playing into this that is making me nervous - the overall market is overbought meaning that a lot of stocks are extended from proper buy points. When this happens the market can "correct" itself and decline in value taking 3 out of 4 stocks with it.
Despite the overbought market, some stocks are still in buy ranges but trade them with caution. I see one stock, LifeTime fitness (LTM) in a buy range and this would be more of a longer-term trade versus FMCN. I presume we are looking at least a month to 3 month trade. Here is how I would set up the trade.
Buy LTM 46.36.
Stop loss order of $43.42
Price target $52.00 (12% gain)
WDC may be bouncing off the bottom. The signs show an increase in buying of shares as it has bounced of $16 twice in the past couple of months and 3 days ago a large amount of buying went into the stock. This too is a long-term trade that may take months to develop. Here is the set up:
Buy WDC at $17.50
Stop loss order aat $15.50
No current price target.
HSR is a risky trade as it is a low-priced stock and basically it looks as if this is bottom-picking meaning that I am trying to predict a bottom. From here the stock should rise. This trade is not for the risk-averse.
Buy HSR at $8.10
Stop loss order at $6.80
Initial price target $9.90 (22% gain)
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