Friday, September 3, 2010

A Double Top In Checkpoint

CHKP is wedging up to its April high and looks ready to roll over with negative divergences showing up. The most likely target is the July low at 28.82 or below. CHKP broke out of a muli-year trading range in August last year. I was fortunate to be able to sell on this B wave rally near the April high for a gain of 25+%. Given the length of the trading range I was holding this position with a wide stop below breakeven as I expect it has much more to run, but the pattern clearly shows that it will likely retest that trading range breakout level this fall in the 27 to 29 where I will be looking to buy it again. The next upside targets are 44 and 64.

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