Real Money Charts: February 22, 2008
There are the charts in Friday’s column on RealMoney.com: GE, CS, MBI, VSEA, SWIM, and CLB
GE sure looks a lot like the S&P 500. In fact, the charts are almost identical…though GE is underperforming the S&P. If you want to buy GE,…if you’re SURE you want to buy GE (hint, hint),…then this might be an acceptable buy point just because current support is so close. But if the stock breaks below $33, I’d sure turn the lights off and go home.
This weekly chart shows the rise and fall of CS. After peaking above $75 last year, the stock has taken a 30% haircut…and is still in the barber’s chair. If support doesn’t hold up now, I’d look for another 20% decline before CS looks attractive. If you want to buy one of these big brokers, look at GS — it’s better.
MBI pretty much epitomizes the subprime mess. Until this stock starts trading back above the downtrending resistance line…and above the 50-day moving average, I’d just stay away and let the smart guys try to pick the bottom on this dog. I’m sure there’s value in there somewhere, I just can’t see it because I’m blinded by all the risk!
VSEA sure looks like it’s trying to put in a bottom. But until the stock is decisively above the 50-day MA, I wouldn’t count on the downtrend changing. Instead, just be patient and let the price action tell you when the stock is ready to move higher.
This weekly chart shows the wide swings that SWIM seems to make each year. With the stock now back down to test the support trendline, it’s not a bad place to buy this investor education company. But even those guys will tell you that you’d be well-advised to keep a stop just below last week’s low. Because if that level breaks down, the stock just might sink rather than swim.
CLB is stuck in jail right now. It’s above the 50-day moving average, but still below the last major resistance level at $130. It’s too risky to buy now, but I might take a stab on a pullback to $120, with a stop about $5 below that level.
Be careful out there.