Tuesday, October 24, 2006

Chart Requests: QCOM, CAT, TIE, NUAN, VAR

Here are my thoughts on a few stocks requested by readers. I received a lot more requests than I expected, and couldn't get to all of them, so I went with the first five requests. Please keep in mind these are not buy or sell recommendations.

QCOM (Qualcomm, Inc):
This stock is in no man's land. I would not touch it unless it breaks one of the S/R lines on the chart. A break below $36 would be an indication to short, while a break above $40 might get me in long. The reader who made this request bought the stock at $36. If I were holding the stock, I'd place a stop at my purchase price and sell on any short term strength.

CAT (Caterpillar, Inc):

Caterpillar's breakdown makes for a good short setup. I will be watching $62 and $64. If CAT reaches these levels and fails, it's time to short. If it breaks out to the long side , it's a sign that the reaction to earnings was overdone. I'm a bit weary of shorting right now, since, over the past year, the stock has had a bullish reaction to extreme oversold levels.

TIE (Titanium Metals Corp)

This stock has been on my short watchlist for quite some time. However, there's no denying the latest breakout. Talk about a beauftul move over resistance on strong volume. I am watching this stock on the long side, and will enter if it reacts well to a pullback to $30.

UAN (Nuance Communications, Inc):
Nuan's giving us some conflicting signals. RSI is not where it was when it was at the same price level in early October and MACD has been sloping down all month. However, the stock reacted well on a pullback to it's breakout point. I would wait for a "tell" before entering. If the stock breaks out over $10.50, I'm in on the long side. A nice short setup would print if NUAN breaks down below the last breakout point, around $9.40.

VAR (Varian Medica
l Systems, Inc):
Var looks ugly, which makes it a great short setup. There are two ways to play this one from the short side. Either enter on a break down below $48, or look for a failed bounce at $49.

Thanks to all of those who have emailed, left comments, or visited my site. I plan to make chart requests a regular feature, so feel free to request a chart.

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