QCOM Daily Chart
QCOM (still fresh in my mind from some nice profits in February) caught my eye after Friday’s trading session for having unusually high volume and what looks to be a potential bullish reversal signal. The stock transacted over 34 million shares versus a 10 day average of 14.4 million shares. Also worth noting the monster intraday reversal with the stock having a significant gap down opening at 51.80 (Thursday’s closing price was 53.21) and a brief selloff down to a low 51.05 which occurred about 10 minutes into the trading session. From that point, the stock began to climb higher for the remainder of the session and close at 53.74. [The volatility for QCOM in Friday’s session seemed to be caused by news which broke premarket regarding the company revising down on its forecast due to a lack of licensing revenue related to an ongoing legal battle with Apple.] If QCOM continues higher on Monday and breaks above Friday’s high of 53.95, I would be interested in opening a long position around 54.10. From there, looking for the stock to make a run towards 58.67 which was the high from 1/23 and also where the stock found resistance in mid March. On a pullback below 53 I would look to add more shares of QCOM as the area around 52.70 has provided support on a number of occasions in January, February, and April. Friday’s low of 51.05 would be the stop area, which also represents the low of 2017. Based on these levels I am looking to position size based on two possible scenarios: 1) If I buy only on the initial breakout I am risking about 1% (portfolio) to make about 1.5% and 2) If I buy the initial breakout plus the pullback I am risking about 1.5% to make 3% and thus achieving my goal of a 2/1 reward/risk ratio.
This trade could potentially catch the next QCOM dividend as it goes ex div (0.57) on 5/26. Earnings out of the way until 7/19.
QCOM daily chart
QCOM has been behaving very nicely since I initiated a long position at 54.41 on 2/13/17
. For starters, I managed to capture the $0.53 dividend on 2/27/17. Then yesterday (3/10/17) I sold 2/3 position at 58.74 with QCOM hitting my predetermined profit target area of 58.67 which represents the high from the massive selloff on 1/23/17. From here, looking to sell the remaining shares at or around 60 which I believe there will be some resistance as the area acted as support in July, August, and September 2016.
Bought QCOM today shortly after the open on continuation through Friday’s high.
QCOM daily chart
QCOM caught my eye after Friday’s trading session and looks to be presenting a pretty good opportunity for a low risk trade to the long side. Noting this as purely a technical setup as earnings are out of the way until 4/19/17. The stock looks to be forming a base with today being the first close above the 8EMA since the recent sell off. QCOM closed on Friday at 54.00 and had an intraday high of 54.28. The stock has plummeted so far in 2017 from the mid 60’s to its current level at 54. January 23 specifically I look at as the day of panic selling or capitulation due the major gap down from the 60’s into the 50’s. QCOM traded over 94 million shares that day, a volume of which the stock has not seen since April or 2010. That’s a serious amount of shares changing hands.
Along with the bullish candlestick demonstrated from Friday’s price action, QCOM is just beginning to come out of oversold stochastic territory with ascending volume. If it can cleanly break through Friday’s high of 54.28, I’d be interested in opening a long position in the range of 54.35-54.40 with a target of 58.67 (which is the high from the January 23 gap down day) and a stop beneath 52.37 (February 2017 low from 2/2/17).
Also worth noting, QCOM goes Ex-div ($0.53) on Monday, 2/27/17. May be willing to risk/position size slightly larger knowing there is a chance to catch the dividend. Let’s see how the stock goes on Monday.