Aspen Insurance Holdings

Last up is mid-cap insurance firm Aspen Insurance Holdings ( AHL). Aspen has been locked in an uptrending channel for all of 2012, rallying higher in between well-defined trend line resistance and trend line support levels. Those boundaries make it significantly easier to spot the high-probability moves in this financial stock.

Right now, AHL is sitting up near resistance, which makes another move lower look likely. After that, investors should be looking for an opportunity to buy on the bounce off of trendline support.

If the stock's in an uptrend, why wait? Well, the best time to buy a stock that's in an uptrending channel comes at support -- it's the place where shares have the furthest to move back up to resistance (the top of the channel) and where they have the least distance to move through support.

Since a breakdown below support means that the channel is broken, support is also a logical place to put a stop below to ensure minimal risk. The ideal AHL trade will take a little patience, but it should be rewarded in the end.

To see this week's trades in action, check out the Technical Setups for the Week portfolio on Stockpickr.

-- Written by Jonas Elmerraji in Baltimore.

RELATED LINKS:



Follow Stockpickr on Twitter and become a fan on Facebook.
At the time of publication, author had no positions in stocks mentioned.

Jonas Elmerraji is the editor and portfolio manager of the Rhino Stock Report, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including Forbes and Investopedia, and has been featured in Investor's Business Daily, in Consumer's Digest and on MSNBC.com.

If you liked this article you might like

How to Eat Lunch With Billionaire Warren Buffett

Bank Stocks Move Higher as Fed Decides to Start Unwinding Balance Sheet

Jim Cramer on Equifax, Wells Fargo, Federal Reserve, FedEx, Adobe and Toshiba

Elizabeth Warren Slams Wells Fargo, Equifax: Cramer's Top Takeaways

Target-Date Funds, Touted as a Retirement Panacea, Don't Always Deliver