NEW YORK ( TheStreet) -- In the search for under $5 stocks that hold promise, here's a stock that is starting to look appealing for a trade. It's not as if it has definitely turned the corner and to buy it now is quite speculative, but the reward-to-risk is reasonably and worth a shot -- or so I have decided that is so.

The company is Hansen Medical ( HNSN), and they develop, manufacture, and market medical robotics designed for accurate positioning, manipulation, and stable control of catheters and catheter-based technologies. They have some tough competition and that is a big part of their painful looking charts, but there is a sign of a pulse finally.

Here's the monthly chart, which shows just how low a stock can go. Hansen has trade from a high of $40 in 2007 to a recent low of just under a $1.50. The classic down trend line has been drawn in and unless this stock is going to zero, you have to think the line breaks soon. Short interest is a little over 6% so a little short covering might be in order if and when that happens.

I've penciled in the resistance zone, which is better seen here on the weekly chart. The zone is anchored by the high volume bars from April and May. In early October Hansen thrust higher and was repelled by that resistance zone.

The daily chart is where the trade is centered. Support is clearly defined and a stop out under the support zone is the way this has to be traded. It is kind of now or never for the stock. If these recent signs of strength are real, then a break of the long term downtrend line should occur and Hansen should trade back to the top of that resistance line to around $2.25. That's a big move on $1.75 stock and why I bring it to your attention. Purchasing it here and back into the support zone is the plan.

Until next week, just keep trading the charts!
At the time of publication, Little was long Hansen Medical, though positions can change at any time.

L.A. Little, author, professional trader and money manager, writes daily on www.tatoday.com, a free educational site for traders and investors. He has been featured in numerous publications and is the author of Trade Like The Little Guy.

His background includes degrees in philosophy, computer science, computer information systems and telecommunications. With a trading philosophy centered on capital protection first and the accumulation of consistent gains over time, L.A. espouses a simplistic technical approach to trading the markets that is a throwback to the days of past. With a focus on swing points and the qualification of trends, L.A. provides a breath of fresh air to an otherwise crowded room of derivative indicators with the emphasis on technical minutiae.

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