CY (Long)...

I'm going back to the tech well yet again and this time it's CY we're looking at. Tech is where a lot of the good charts are, so that's where we want to be, too, but not 100%. Anyway, CY reported earnings last week and there is a lot to like about this stock. It is sitting at all-time highs, having just recently eclipsed its Nasdaq bubble highs from 2000 or so (and there are many big-name tech stocks you can't say that about). This is actually very important because it means there is literally no overhead resistance from the past, meaning basically that the sky's the limit for CY.

In the more immediate term, I like the recent high-volume breakout to new highs that we saw last week. In the short term, I believe CY is too extended to prudently buy, but I view weakness in the stock as a great buying opportunity. Ideally, we would get a pullback towards previous resistance (the dashed purple line) to start a position, and I do expect this to happen. I think we will see another case of prior resistance becoming current support, but if not, further weakness, provided it is of the low-volume variety, would present an even better buying opportunity. Note how CY has consistently bounced off the 50-day EMA for the past several months. The bears won't have a chance to get their claws into this stock and drag it down until they can force it below that 50-day EMA, but make no mistake about it, the bulls are in charge here.



Position: none