Weekly Stock Pick

I hope you had a Merry Christmas and a Happy New Year. It seems we had a mini Santa Claus rally this Holiday Season. I went long some stocks and did ok over the holiday. I am looking for the market to start selling off again anytime soon, but then again it could keep going back also. Right now in general, the charts look like the market is in indecision mode. This seems to me a sign that uncertainty is still in the air, and with that, I’m ready to make more short-sell bets anytime again, and keep my stop-loss tight in case the market decides to move higher.

Scanning the stock charts this early Monday morning and I’ve zeroed in on a short-sell on a big USA communications company. It’s a short sale that is what I consider as a low-risk high-reward trade. That means a 3:1 plus reward to risk ratio for me to be interested. This trade setup is about a 3:1 plus reward risk ratio in the short term, if it works out to the lower Fibonacci levels I’m looking for. Now that’s a good return on trading risk. Longer term, the reward risk ratio could increase. Again keep your stops tight to cut-loss or take profit.

Short Sell Qwest Communications. Ticker Q

Sell Entry: 3.51 to 3.80

Stop-Loss: 3.81

Take Profit Area – See the Qwest chart below for Fibonacci levels to take profit at.

3.32

3.19

3.06

2.87

Qwest Communications Company Profile

Qwest Communications International Inc. (Qwest) is a provider of voice, data, Internet and video services. The Company operates most of its business within its local service area, which consists of the 14-state region of Arizona, Colorado, Idaho, Iowa, Minnesota, Montana, Nebraska, New Mexico, North Dakota, Oregon, South Dakota, Utah, Washington and Wyoming. The Company operates through three segments: wireline services, wireless services and other services. Qwest’s business customers include local, national and global businesses, governmental entities, and educational institutions. The Company’s wholesale customers are other telecommunications providers that purchase its products and services to sell to their customers or that purchase its access services that allow them to connect their customers and their networks to its network.

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Good day, good trading and Happy Prosperous New Year!

Click the Qwest Communications Stock Chart for a larger view.