Let’s see if this can $SWCH into high gear! Watch above 18.66.

by DAN SWCH APPS SWCH 
This is Scott with your Free Chart of the Day. I want to take a look at Switch Inc ( NYSE: SWCH ). Here’s what I like about this chart: I like the fact that Switch ( NYSE: SWCH ) has a long base of consolidation. Basically, this stock has been going sideways since the end of April, and you know the old saying, the longer the base the higher the space.

I love buying stocks coming out of long bases of consolidation. Today Switch ( NYSE: SWCH ) pushed through 3 major moving averages and did it on big, big volume, so there is money coming into this stock. That is pretty much the biggest volume we have had since April

This stock is in a good group being in the technology information services stocks but this one that hasn’t really broken out yet. If you look at stocks that are in this group with it, you look at Digital Turbine ( NASDAQ: APPS ), this stock has just gone crazy, it’s up almost 100 percent since the end of May here.

Meanwhile, Switch ( NYSE: SWCH ), it’s just kind of waiting in the wings here. This volume today, this big volume pick up on higher than average volume, kind of tells me that this may be ready for prime time. So I have an alert here on Switch ( NYSE: SWCH ) at 18.66. I want to see Switch ( NYSE: SWCH ) break above and stay above, and I want that move to come on high volume. The high volume is what will tell you that the institutions are getting behind this stock and that’s what we want.

Here on a weekly chart, if I flip over to a weekly chart you can see it is right at weekly resistance. This is a pretty significant level because we are not only breaking above daily resistance; we’re breaking above weekly resistance. I like stocks that are in weekly uptrends; because as you know the longer the time frame the more the information. So we have a stock here with a nice long base of consolidation, a nice volume pickup today, and a move through 3 major moving averages right at resistance.

So watch Switch ( NYSE: SWCH ) above 18.66. You would only want to be in this stock if it is above and stays above that black line. If it comes back down, well, you would want to close it out, because we are buying it for the breakout, not the breakdown. So keep Switch ( NYSE: SWCH ) on your watch list and set an alert and take a look at it tomorrow.

Free Chart