NEW YORK (TheStreet) - Finding desirable stocks that are bullish based on technical analysis and fundamentals isn't as common as one may expect. Online game maker Zynga (ZNGA) is currently in an investing sweet spot with outstanding monthly, weekly and daily chart patterns and an equally strong balance sheet.
The company is a turn-around story that changed my opinion from completely bearish (I thought it was destined for the dust bin), to one that I anticipate will reward shareholders in the near future with meaningful profits. Not everyone is buying the story though, and as a result, shares are trading near several key technical support levels.
Chart reading may appear confusing, intimidating and mysterious, akin to reading tea leafs for some, but when properly and mechanically analyzed, offers an unbiased opinion on any given stock. I take an entirely mechanical approach, eliminating all subjectivity. It's the only way I know of to get consistent results.
The reason technical analysis or market timing works is that it's actually measuring investor behavior. At the most simplistic level, technical analysis is about people. It doesn't take long for investors to figure out that on any given day emotion is the dominant influence on any given share price.
Because people tend to react in a predictable manner given a known situation, we can reasonably expect some pattern repeat with predictability. We can profit by exploiting the tendency of investors to continue/stop buying or selling as the price action changes.