Pssst.....PSFT!

Everyone should be happy that I have a friend named Pete. He was the one who asked me to look at (PSFT | Quote | Chart | News | PowerRating) for him yesterday. Somehow, he must have known it was setting up for a potential trade!!

I ran the numbers on this stock and came up with two key price cluster zones to keep an eye on for a potential entry for him. First the 34.31-35.31 area stood out as it included a couple of the 100% projections of prior declines. The second zone comes in between 31.71-32.91.

Bottom line, I told him to consider an entry if price held above either of these zones (recent low 35.50) and then took out a prior swing high on the intraday charts. We saw a trigger today. If this trade is any good, it is NOT over yet. As long as these same zones continue to hold, I would continue to set up my entries on the buy side. A violation of both of these same zones gets me to back off until further notice!!