Monday, August 20, 2007

Stock From the Watchlist: BCSI

BCSI has been a big winner over the past six months. Let's take a look at the chart:

The Good:
Strong trend; breakout over resistance; accumulation, strong obv

The Bad:
Breakout not on above average volume; negative RSI divergence (RSI lower on breakout than previous high)

The Verdict:
I wouldn't be suprised to see a failed breakout here, so I'd be hesitant to enter on a pullback to the breakout point. However, a pullback to the 50 day moving average would provide a low risk entry.

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