Qualcomm’s Graceful Swoop
If you trade in an intermediate time frame, you’ll
want to be on the lookout for stocks that the public hates, but which institutions
are quietly snapping up. Qualcomm offers us some insight into this process.
The chart above is a good case study of how a stock makes a steep dive, bases
for a while, and then begins to sneak out of the base. You can see the telltale
signs of accumulation in the price and volume surges that have recently
occurred–Thursday being no exception. Through it all, Qualcomm
(
QCOM |
Quote |
Chart |
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PowerRating) has
swooped up gracefully out of a nosedive that took no prisoners during the early
summer. Volume coupled with a breakout from a two-week range is propelling a
steady ratchet action higher against a backdrop of a weak, bearish market. This
is the kind of end-run that allows institutions to quietly accumulate a stock
while the public is paralyzed by fear of a repeat of the nasty Nasdaq plunge we
had early in the year.
Till Friday,