In the ZHONE and CCJ Update

Hey Gang:

A few days ago I mentioned CCJ as a play that was following a chart pattern I set up to try and predict its movement. I even showed a Bearish Engulfing Pattern as possible evidence that a downturn may be imminent, along with the STO and MACD. Well, after two somewhat blase days, the stock popped up almost $2 on some good news from the Canadian government, as well as some pumping on CNBC. Had I been in a short term Bearish play (which I was not since I don't play the bearish side of a swing trade when the predominent trend is Bullish), I would be getting near my stop-loss of 1% above the high on 4/10/2007 which is $47.97. Here is the chart:

The trade still hasn't broken above the upper resistance line yet, and the stock is still oversold with a falling MACD, so let's see how it plays out. Ideally, I want to enter this trade where I have placed a green oval, which is at the channel support line.

Into the ZHONE

Every once in awhile when I peruse the Yahoo! Finance message boards, I come across a suggestion that piques my interest. On Friday, someone mentioned Zhone (ZHNE), a company I had never heard of. The post mentioned that there was significant insider buying, and the stock made a significant move, so I checked it out and here's what I found:

So here is a CLASSIC INVESTools (technical) entry signal IMHO, three (3) Green Arrows on BIG volume on an uptrending stock. By the way, did you notice the stock price of $1.30? Even better, this is NOT an OTC stock or one of those "Pump & Dump" spam mail stocks you get. This is a NASDAQ listed company, so to me that says "legit." How about the insider buying? Check this out:

So as you can see, there has been some decent amount of insider buying recently which may bode well for the future. If the top brass is buying stock on the open market, they obviously believe something good is going to happen in the future...they are betting their own money on it.

Just something to consider.

Happy Trading!