2. Next, let's look at SouFun, which operates a real estate Internet portal, and a home furnishing and an improvement Web site in China.
SouFun traded positive on Wednesday, closing up 4.87% to $13.36 per share.
- Wednesday's range: 12.83 - 13.40
- 52-week range: 10.03 - 99.72
- Wednesday's volume: 6,579,928
- 3 month average volume: 4,458,300
SouFun is a rounded bottom breakout, and typically I won't recommend a rounded bottom breakout unless it's at least 10% below the 200, but this chart looks too good to pass up. Yesterday's candlestick engulfed the 200-day simple moving average and the 50-day simple moving average.
Plus, during the last couple days, the stock has gapped up. Volume has been increasing during the last three trading days, and there hasn't been much selling pressure during the current bullish move.
There is overhead resistance at $14.59-ish, $15.50-ish, and again at $16.29, which I'd say is the most compelling of the resistance levels. I would have my first target be at the $16.19 level, which is over 21% to the upside, and that would be awesome. If the trade keeps working, my ultimate target would be the 52-week high for +31% to the upside.
There is great potential in this chart, and so even if you targeted the first resistance level, that would be almost 10% to the upside. Don't be afraid to take profits at any of these resistance levels.
Having said that, you should still let the trade work, start with a quarter position and then add to this position when you see positive strength.
I'd set a stop below the t-line at $12.17, and stay long until you see a confirmed sell signal or a close below the t-line.
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