Wednesday, October 21, 2009

TIVO - Waiting & BUY or SELL

TIVO - WAIT

TIVO is currently struggling to go over and close above its resistance level of $11.66, and today have given up all gain closing lower. Today we can observe a shooting star, which is usually the sign of a top. However, TIVO did break above critical resistance at $11.00, and has been holding up since. It may take more time for TIVO to close over $11.66, if it does happen, but one possible scenario that I expect to see occur is see TIVO pullback to around $11.00 and bounce back up. If that occurs this will further strengthen TIVO's support at $11.00. What could happen then is seeing TIVO trend with this narrow channel within approximately $11.00 and $11.70, until it breaks up or down for another BUY or SELL signal. However the fact that TIVO despite pulling back today, has manged to stay above $11.00 is very bullish. My current stop loss order is set at $10.60, which I will probably raise to $10.75 tomorrow. I also have a Stop Buy order at $11.75 to buy more shares if the break occurs upwards. If you already entered into a position with TIVO on Monday, I would suggest to HOLD and set stop loss orders similar to the one's I indicated. A break below $11.00 would be a SELL signal, but to avoid getting whipsawed I will be setting it at $10.75, to get clear sign, since the bounces back up support or resistance levels will never be exact to the very cent, as indicated. If you are looking to enter into a position with TIVO I would wait and see if it does indeed bounce back up $11.00, and then you would have another BUY Signal. However, you may prefer to even wait for a break above $11.66, if you believe TIVO might trend within a narrow channel at $11.00-$11.70 for a while.

Long TIVO@ $11.30 - Stop Loss @ $10.60 (-6.19%), likely increased tomorrow to $10.75 (-4.86%) - Stop Buy @ $11.75 (+3.98%)

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