Is it too late to buy Alliance Techsystems (ATK)? (June 04, 2014)

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I want to look at Alliant Techsystems ( NYSE:ATK ) today. I’ve been bullish on this stock for quite a while, bullish of Alliant Techsystems ( NYSE:ATK ), long of Alliant Techsystems ( NYSE:ATK ); and this big pullback looked like the wheels came off the wagon, well they kind of did, and that was the end of that, but the stock bounced off the 200-day moving average. When you see a stock like this fall out of bed, and this definitely did, and hit a key moving average, watch for the bounce, it doesn’t necessarily have to bounce, a lot of times they just knife right through, but watch the bounce. And here the stock did bounce and then actually never came back, it came back to test it a couple times, but this was really like a two day reversal pattern here back on the 21st and the 22nd.

So since that time the stocks going up, one thing to keep in mind, look at the volume over the last three days, you had a big volume day here, the next two were both up, higher lows, higher highs, but volume has been declining. So I’d actually look for this stock to kind of pull back a little bit, but lets see if that’s a buying opportunity. Look at the weekly chart, the weekly chart shows a better indication of what’s happening here. Big nice move up, big nasty sell off, I’m looking at this and if you look at the volume now, on a weekly basis, it’s really high and we’re only through Wednesday; now a lot of that is because of the big volume we had on Monday.

So I would suggest buying this stock still, this most recent low here was 118.00, so I would keep a stop at literally about 117.00. You buy this stock here, that’s kind of a loose stop for me, but really the ultimate support here is on this big sell off. I don’t think it’s too late to buy Alliant Techsystems ( NYSE:ATK ), this is not a trade it’s a hold, this is a stock that you just buy and hold, reasoning that this sell off was kind of overdone; a lot of folks have thought that it is, you can see how the stock bounced, but I don’t think that it’s done yet.

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