Stock Chart Analysis MVIS

Posted by downtowntrader | 9/05/2007 09:20:00 PM | 0 comments »

Stock Chart Analysis MVIS

Microvision, Inc. (Public, NASDAQ:MVIS)

I've trade MVIS a few times this year, mostly successfully. Recently, they reported a deal with Motorola and instead of rocketing higher, it steadily sold off giving back all the post news gains. It kept dropping testing prior swing lows. I've been a bystander in this stock the past few months waiting for a low risk opportunity. Recently, it threatened to break down from an established support line, but held up, and then had a move yesterday making it back above the 50 day sma. This could of cemented the bottom here, and paves the way for a retest of the recent highs. At worst, at least now there is a clearly defined stop loss for a swing trade.

The nice thing about this possible trade setup, is that the longer term picture is pretty rosy for MVIS. It's always a good idea to trade with the larger trend, and there is no denying that MVIS has established a new uptrend. It is consistently making higher highs and lows on the weekly chart. It also clearly broke an established down trend line, and formed a confirmed reverse head and shoulders bottom. Volume is in all the right places, and it appears that this is a solid pattern. It's hard to project targets in low priced stocks, because the move from $1-4 is a 200% move yet the measured target is only 3 points from the breakout point. This still yields a conservative $7 target.

Today MVIS offered a pullback off yesterday's strong move, but held at the rising 20 and 50 day smas. This could be a decent low risk / high reward opportunity.

Good Trading,


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Disclaimer: I started a small position in MVIS today near the 50 sma. I am highlighting it because I will add to the position if it continues to move out.