Be Flexible with Flextronics
- Posted by Greg Harmon
- on April 22nd, 2014
Flextronics, $FLEX, has been in the cross-hairs before. It was a Top 10 Pick on March 24 but never triggered. Much of the reasoning for putting it on the radar is the same as it was then. With this stock you need to be flexible. Take a look.
The daily chart above shows an ascending triangle building against upward resistance at 9.55. This was also the top in September 2013 before it started the move lower to 7.00. The Measured Move on a break over 9.55 would take it to 10.30, a good potential return. There is also an Inverse Head and Shoulder pattern with a target of 11.80 on a break of the blue neckline. Oh, and there is a Cup and Handle there as well with a target to 12.10. And the momentum indicators, RSI and MACD are supportive. In fact the RSI remains in the bullish range, while the MACD is crossing positive. With the 50 day SMA moving higher, and recently contacting the price, the picture is a bit brighter since the last time the MACD crossed up. This is not a layup trade, but for a potential 26% return after a year of resistance it may pay to be flexible enough to take it on the trigger.
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Gregory W. Harmon CMT, CFA, has traded in the Securities markets since 1986. He has held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)
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