Channeling Stock Watch – Spot the Box

Here are two channeling stocks to put on your watch list and if nothing else paper trade. This blog will be brief, see the previous blog “channeling stocks” to get a more in depth understanding of this analysis.

Baker Hughes “BHI” is providing a $5.00 channeling range trade opportunity. So far this stock has given two complete revolutions, and setting up for a third if we get a bounce off of support.

One thing to note about the chart on the days to “buy” you should look to buy on a bounce off of support (i.e. a positive/green/up day) because at some point the pattern will break down. The bounce off of support is your first indicator that the pattern is looking to continue, nothing is guaranteed in the market and no one want’s to catch a falling knife. Be smart, use the bounce off of support as an entry and a frame for being wrong, when to exit the trade (i.e. the stock turns around and trades below the bounce).

Same thing goes for selling, you should look to sell on the first down day of tagging the upper support line.

Here is the second one as promised “SM” SM Energy Company. This one offers a nice $10 trading range.

I’ll also leave you with some homework. What confirming pattern do you see in the Stochastics “StochD” indicator when channeling stocks reach their support and resistance level?

Figure this one out and you’re well on your way to moving out of the beginners club. The key to technical analysis is not only knowing how to read technicals but knowing which indicators apply to certain stock behaviors.


About A-B Financial L.L.C.

Hello, my name is Jason Brown, your host for all these wonderful stock and options blogs. For those of you who don't know me I thought I would give a little background on myself. I started trading back in 2003 when I was introduced to the market by a family member. I always heard about the stock market and how people became wealthy from it but I never knew how or if I could do it. I started my trading account with $500 dollars. I thought "if I could just make $50 I would be set", that was big bucks to me back in 2003, especially money I did not have to work for. Well I made that $50 and soon realized the potential of the market and what it could do for me, for my family, for my lifestyle. I shortly after took a $10,000 student loan that was suppose to pay for tuition at Wayne State University and put it to work in the market and grew it to a six figure income. Since that time I have made and sometimes lost more than most people make in a year with a husband and wife both bringing in a dual income. I started this blog to share with you my years of trading experience, success and mistakes in today's current market environment. I do not give advice just my analysis and perspective on the market and how to invest using options. All I ask is a few simple things. If you like what you read please leave a comment or click the like button, also if these analysis makes sense to you and you know someone who could benefit, please share it with them as my aim is to reach as many traders as possible. Thank you for taking time to read and follow my blogs, I am honored. J.Brown (stocks and options analyst
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