It has been some time since we have heard the battle cry for bandwidth. It was just prior to the dot-com bust that we last heard of the potential and endless growth possibilities of the Internet.

To deliver on the promise of the Internet required greater bandwidth, and there was plenty put in place in anticipation of the coming content boom. Back then the likes of

Lucent

,

Nortel Networks

(NT)

and upstart

Ciena

(CIEN) - Get Report

were flying high as investments in the Internet infrastructure boom.

We all know how that ended; like almost all other manias, it ended quickly and suddenly. The infrastructure build-out left a lot of this fiber-optic cable unneeded and unused. Recently though, this has been changing, and the content that was anticipated back in the late '90s is finally coming online, requiring the use of that infrastructure and a whole lot more.

The phone and cable companies have been rolling out new high-bandwidth products and services over the last couple of years. Increased demand for high-bandwidth data has benefited the service providers like

Verizon

(VZ) - Get Report

,

AT&T

(T) - Get Report

and

Sprint

(S) - Get Report

. It has also benefited those companies who supply the technology to build the infrastructure. These are the same companies that were doing the build-out prior to the technology bust.

There are a couple of standouts on a

technical basis, and we are highlighting those we see as the best opportunities in this space. We are also intrigued by these stocks due to the general improvement in technology we have seen on a comparative relative strength basis vs. the broader market.

A blast from the past and perhaps the best-acting stock in the telecom-equipment space is Ciena Corp. Ciena had formed a significant head-and-shoulders bottom over the past 18 months leading up to late May. This is when the stock went on the offensive by gapping to the upside on increasing volume. A gap occurs when there is a significant surprise, in this case, a positive surprise, and typically acts as a strong price catalyst for further price appreciation.

Since then, the stock has continued to advance, pushing forward another 13% since this defining move higher. We anticipate this issue continuing its advance up toward the mid $40s. We would prefer to buy on pullbacks to the $34-$35 level.

Another way to play the improvement in this sector is through

Cisco Systems

(CSCO) - Get Report

. Cisco has been in the base-building process since late December 2006. This has been an orderly process, with volume drying up through the consolidation and recently beginning to increase. This is a sign for buyers beginning to return to the stock and pushing it higher. We would be a buyer at current levels and on any further strength above the $28.50-29.00 level. A move above the level would suggest a breakout and the completion of the basing process. This would indicate further strength to the mid $30s is likely.

At the time of publication, John Hughes and Scott Maragioglio were long Cisco. Hughes and Maragioglio co-founded Epiphany Equity Research, which has developed and utilizes proprietary tools to identify and track liquidity changes in the market indices and sectors. Hughes advises numerous asset managers, hedge funds and institutions managing in excess of $30 billion. Maragioglio is a member of the market technicians association (MTA) as well as The American Association of Professional Technical Analysts (AAPTA) and holds a Chartered Market Technician (CMT) designation. Maragioglio has also served on the board of directors of the AAPTA.