Will Traders Turn Toward Tech? 3 Techs Stocks for the Next 3 Days
While traders are pondering the fates of tech giants like Oracle Corporation (ORCL) and Hewlett-Packard Co (HPQ), lesser known tech stocks have pulled back toward levels from which they have historically made significant short term gains.
Which stocks? Consider Maxwell Technologies (MXWL). The stock rallied to year-to-date highs at the end of September and was met by fairly trumphant – and ultimately excessive in our view – profitaking. After pulling back for four consecutive trading days, including a finish in technically oversold territory above the 200-day moving average, shares of MXWL are more than ready for a short-term bounce.
Much the same can be said of Universal Display Co (PANL). After rallying to its highest levels since the spring, PANL became the target of aggressive profit-taking as traders took their chips off the table. Only recently at multi-month highs, PANL has pulled back for four days in a row – the last two in technically oversold territory.
Silicon Motion Technology Corp (SIMO) is our third stock and – like Maxwell Technologies experiencing aggressive selling after rallying to set new highs for the year. Shares of SIMO have moved lower so swiftly that it is hard not to believe that panic selling may be setting in. SIMO has closed down for five straight sessions above the 200-day, and is set to open on Tuesday deeply oversold.
Buying stocks after they have pulled back – and especially after they have entered technically oversold territory – and selling them into strength is a quantified way to consistently buy low and sell high. Read more about “buying the selling” as a short term stock trading strategy here.
MXWL, PANL and SIMO were selected for today’s report using a trading resource called PowerRatings. For more information, visit us at TradingMarkets.com.
David Penn is Editor in Chief of TradingMarkets.com