Profit Hunting

Quick technical post on two charts catching my eye just now.  I’m on a different computer than usual so forgive me for the lack of notation on the images.

AMBC ripping

AMBC rapid expansion phase

AMBC isn’t a ticker I normally keep an eye on but it popped up on my expansion scan today.  Great inverse head and shoulders and a strong base breakout.  It’ll be interesting to see if this consolidates on lower volume within a narrow price band next week.  This will provide a good momentum-based technical setup, however I don’t like how extended this is from nearest support from a risk management perspective (30% away).

PVH flag

Post reversal consolidation

PVH is another stock I’m not familiar with, but it too popped up on a scan today.  I don’t often sit and watch the markets live at the moment, so when something does pop up I usually have a good look at it.

This has a good expansion phase, but what I’m more interested in is the classic 3-day consolidation phase on light volume after expansion.  Prior to the advance from 115-125, it formed a nice double bottom reversal formation at a previous gap area.  After moving sideways for some time, a reversal and continuation formation could serve as a good catalyst moving forward.

Despite the small profit potential on a $10 measured move, this setup has low downside risk at $124, offering a risk/reward of 5:1 at todays price.  A second buy opportunity lies at the $115 area, which could also yield a short-side trade on a breakdown.

Two decent charts to keep an eye on.

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