Interphase Corp. (INPH)

Here is the latest pick from Faizan's Stock Picks

"Interphase Corp. (INPH) is a technology company which specializes in computer peripherals. As of now it is trading at $5.20 a share. Interesting formations are appearing on INPH's chart which I would like to point out.

The following chart is a daily chart for INPH with an Ichimoku cloud overlay.

First thing to notice on this chart is that starting May 2009 INPH established a continuous downtrend which finally lasted in November 2010. During this 19 month time period the stock lost more than 80% of its value. At that time the stock was highly oversold, and was ready for a good upthrust.

Then, starting December 2010 the stock made some rapid upward moves and after about 1.5 years it finally broke above the Ichimoku cloud on incredibly high volume. Supporting this increase was a sharp uptrend in the stock's RSI which is a very bullish indicator. Also, at the tip of this uptrend the stock broke a very significant resistance level at $6.00 leaving no overhead resistance on this 3 year chart. This clearly shows that the current tape formation for this chart is very healthy and we can expect a continued upward trend for the near short term.

Now lets look at the another chart for INPH.

This is a one year daily chart without the Ichimoku overlay. On this chart we can see that after the recent high at around $6.50 the stock is now trading in a narrow symmetric range. A breakout above this range will indicate another bullish run, while a breakdown would mean a correction. So this chart is worth keeping an eye on as well.

Also, notice that recently the 50 day and the 200 day moving averages crossed over indicating a bull. Combined with that the Chaikin Money Flow indicator shows that the that the stock has remained above the crucial zero line for most of the last six months indicating that the stock is fueled up now and is ready for a ride. (For more on volume indicators read The Trader's Book of Volume: The Definitive Guide to Volume Trading).

Finally to decide on good sell points we shall take a look at the following all data chart for INPH.

It can be seen from this chart that the next resistance level(from 2007) is around $9.00-$10.00. So, this can be a good sell point for mid term traders. This is just a casual advice. Rely on your own intellect to choose a sell point, because finding a good sell point is more of an art than science.

(Being a pure technician I usually avoid listening to news about stocks. But going against my own beliefs I would like to throw in one: Interphase Corp's directors Strunk Christopher, and Myers Michael collectively purchased 9000 shares of INPH on 15th and 18th February.)

So to sum up I believe INPH is presenting an excellent buy opportunity, provided that the stock breaks above the narrow trading range (which may take a few weeks). That's all I have for now. Don't forget to subscribe for feeds. Have a great weekend!"

This Post was from Faizan's Stock Picks

0 members like this

Comment

You need to be a member of BullBear Trading: Stock and Financial Market Technical Analysis to add comments!

Join BullBear Trading: Stock and Financial Market Technical Analysis

Comment by J CHAN on May 6, 2011 at 7:42am: From May 1 to yesterday, 17 stocks popped. Assume buying right at the open the following day, 10 are now underwater. Of the remaing 7, 5 gains over 8%, they are : GENE, RAH, SGI, kLIC, BIOS.

Since the market does not cooperate, it may be best to stay on the sideline rather than taking the small losses, which can be numerous as pull backs are inevidable at some point but much quicker when market sell off.

Stock to watch today: AZPN, ERTS and MW.

Comment by J CHAN on May 5, 2011 at 9:45am: CIDM spike is not particularly strong and lead to current pull back. Also, when I open 2 day - 5 min chart, there are lots of gaps with no trades, that tell me the stock is too thin. I rush to the down side at the gate this morning.

Comment by J CHAN on May 5, 2011 at 9:31am: I am watching GENE for reentry. I think this is the animal of the day.

Comment by J CHAN on May 5, 2011 at 9:28am: Did not mention BIOS. But did buy this on the Open.

Lesson to day is only buy on limit at Open Close to yesterday's stop when future is up. Watch 2 minutes chart for better buy point when future is down.

Well, stop takes away the weak ones. Save one self from cashing in the entire portfolio.

I have been hurt many times without stops. I guess the stops are the lesser of the 2 evils. It allows me to focus on the buys and profit taking (if any, I never like to take profit). If a stock is interesting and stops you out, there is always the chance to get it back and may be at a

lower price.

Possiblities for today are: BEAT, CAG, HLF, KLIC, ORS, RAH and SGI.

Comment by Mohammad Faizan Azam on May 4, 2011 at 10:17pm: HOLX looks really good... I would give it a little more time before jumping....

Personally I do not like using stops, but it is my own opinion. For some stops can work great.

Another stock that might be in for a big move is CIDM, I have been watching it for a few weeks now...

Comment by J CHAN on May 4, 2011 at 9:22am: Buy INCY and HOLX on Limit not much higher than yesterday's close.

Set Stop right below yesterday's low.

Consider dumping BANR, TRS and NCR. These guys pulled below upper Keithner limit and ability to fly near term is in questions.

Comment by J CHAN on May 3, 2011 at 3:35pm: It is curious how the stock hold up at support so well when the Market pull back but die when the Market started the upswing. Can't trust those symetrical triangles. Need decisive breakout and follow-through.

Comment by J CHAN on May 3, 2011 at 3:31pm: INPH is officially death today.

Comment by J CHAN on May 3, 2011 at 3:17pm: GENE is whining nicely. There has to be more upside on this one.

BANR stop decreased to 2.49. Last stance - no more lowering.