Don't Ignore This Chart!

This Small Semiconductor Stock Has A Big Chart

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A little more than three weeks ago, a very small $435 million semiconductor company reported quarterly EPS that nearly tripled Wall Street consensus estimates.  Quarterly revenues also beat estimates by roughly 3%.  That combination sent Nanometrics (NANO) soaring on April 27th, at one point up 20% on the session.  NANO became overbought at that point and has spent the past few weeks consolidating with its RSI falling from 80 to nearly 50.  The top of gap support at 16.99 and price support at 16 should offer up an excellent reward to risk long entry should the price of NANO move to those levels.  A closing breakout above 18.14 would be bullish.  Check out the chart:


While the action here is clearly bullish to me, there is an issue regarding liquidity.  Volume has been stronger the past few weeks, but over the longer-term NANO tends to trade fewer than 200,000 shares per day, and many days fewer than 100,000 shares.

Happy trading!

Tom

Tom Bowley
About the author: is the Chief Market Strategist at EarningsBeats.com, where he provides stock market education, guidance, and trading strategies using a unique combination of technical, fundamental, and historical analysis. Tom provides EarningsBeats.com members with four portfolios (Model, Aggressive, Income, and Value), all designed to beat the benchmark S&P 500, and a revolving Watch List of hundreds of companies reporting strong quarterly earnings (must beat both revenue and EPS estimates) and exhibiting technical strength as well. These companies comprise EarningsBeats' annotated Strong Earnings ChartList (SECL), from which Tom trades exclusively. Tom writes a Daily Market Report (DMR) for members to include an executive summary, market outlook, sector/industry watch, and trading ideas. Learn More
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