Stocks finally hit a wall today, falling significantly, yet not giving up the gain for the week. Nevertheless, we're finding more bearish setups than bullish charts today. Here's a closer look at Plug Power Inc. (NASDAQ:PLUG), Zhone Technologies, Inc. (NASDAQ:ZHNE), and Delta Petroleum Corp. (NASDAQ:DPTR)
I mentioned
Zhone Technologies, Inc. (NASDAQ:ZHNE) had bullishly pushed off a rising support line a dew days ago. Following the dip earlier this week though, the message bears repeating.
The support line on our chart below is clear; Zhone Technologies has been guided by it since March. In fact, it was the reversal point for ZHNE this past week... again.
What we didn't have
the last time we looked on the 4th was volume. We saw Zhone Technologies shares rallying sharply, but it was a volatile - perhaps errant - move. Though you can't quite see it on the chart below, now that ZHNE has settled down, bullish volume is starting to flow. That could be enough of a catalyst to get the stock back up round $0.80 or so.
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I've got bad news for owners of
Plug Power Inc. (NASDAQ:PLUG), and then a little more bad news to salt the potential wound. The latter bad news has a shot at being sort-of good news though. (How was that for leaving myself all sorts of 'outs'?)
OK, here's the deal.... Plug Power shares have been knocking on the door of support at $0.88 for the last couple of weeks. I don't think that line will hold much longer, but there's always a chance. The counter-argument is that the volume for PLUG on the way down has been getting lighter - not heavier. So, don't jump the gun.
If PLUG does move under $0.88, I expect to see a fall to a very long-term support line at $0.66. That one's been in place since October of last year. If that one should also happen to fail as a floor, Plug Power Inc. could be in some serious technical trouble then.
How much worse can things get for
Delta Petroleum Corp. (NASDAQ:DPTR)? We're about to find out.
Today's low of $0.89 from Delta Petroleum shares is the result of a surprisingly long string of lower lows. It also matches a multi-year low hit back in February. Given the nature of the move and the psychological importance of $0.89, DPTR is clearly at a major inflection point.
If the stock reaches under, let's say $0.87, I foresee a fire-sale... a lot of other eyes are on this support line. The fact that volume has increased for Delta Petroleum over the last few days - as it was headed lower - does not bode well either.
If you'd like to know of any changes in our opinion of PLUG, ZHNE, and DPTR (or if we officially recommend them as trades), be sure to sign up for our free newsletter today. It's delivered weekly.
