Ambarella, GoPro, Kindred Healthcare, Waddell & Reed: How to Trade

NEW YORK (TheStreet) -- With the market closing Tuesday in a three-day losing streak we are keeping an eye on four charts: two of them are bullish while the other two could provide you with opportunities to make money by short-selling them when the market falls.

Starting with stocks to hold in your portfolio, we have Ambarella (AMBA) , a supplier of processors for professional video compression, digital cameras and IP cameras, which had a very good session on Monday in a down market, up 84 cents to $39.59, while closing Tuesday around $41, up nearly 21% for the year to date. The stock recently broke out of a rounding bottom point and rose through lateral resistance at the highs from January and March. 

After a three-day run, AMBA pulled back on Friday, but held up pretty well and may be consolidating here. In the bigger picture, the stock is in a very strong, long-term, rising pattern and has a lot of room to run if the market cooperates.

GoPro (GPRO) is still looking good, too. Shares of the maker of portable cameras have been flagging after its big run-up in the last month. It twice held key support around $63.25-$63.75, and looks poised to move higher. A move through recent highs at $71.50 could take GPRO to the high-$70s and then the mid-$80s. It trades around $73, up nearly 133%.

Of the stocks to sell, Kindred Healthcare  (KND)  broke down precipitously out of a head-and-shoulders top last month. After battling back to resistance, it is right at its support level of around $19. Next stop is $17. It currently trades close to $19, down 4.5% for the year to date.

Waddell & Reed Financial (WDR) , which has been trending lower since April, last week rallied for a couple of days and then began to roll over. Watch support at $51.25. Beyond that this stock could go all the way down to the $46-$47 zone. The shares trade around $52 right now, down 20% on the year to date.

See Harry's video chart analysis on these stocks.

At the time of publication, the author held no positions in any of the stocks mentioned, although positions may change at any time.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.


TheStreet Ratings team rates AMBARELLA INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate AMBARELLA INC (AMBA) a HOLD. The primary factors that have impacted our rating are mixed ? some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and impressive record of earnings per share growth. However, as a counter to these strengths, we also find weaknesses including premium valuation, weak operating cash flow and disappointing return on equity."

You can view the full analysis from the report here: AMBA Ratings Report

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