FTNW is setting up nice for a quick 5% reversal. Here is my breakdown:
When I screen for stocks I want to check a couple of things:
-Price: I like to look for stocks under $7.00
-MFI: I want to see the MFI below 30, preferably curling up across or over our oversold territory of 20.
-Trending Up: I want to see at least 1 trending candle up. It doesn't necessarily have to be a reversal candle but I want to make sure that there are buyers in the price action.
-Volume: I want to make sure average volume is at least 250k.
With all that said FTNW meets all this criteria. First things first let's take a look at the MFI on this. As many of you know I trade the MFI religiously. The MFI here on FTNW has just bounced off the oversold territory of 20. It's curling up which is syncing up with our green candles. Looking back at the last three times (on this chart) we can see that each time the MFI has hit these levels and reversed our price has increased as well.
Now, when it comes to stocks like this I am a 5% trader. So for 5% we don't need a lot of price action. This is good because our trending lines aren't too far apart. However, if we see a break above this top line it could be very solid. To help gauge how much we can expect on this I like to look at the recent intra-day price movement which you can get absolutely free from Nasdaq:
It looks like we have solid intra-day movement and there shouldn't be a problem hitting our price target based off this recent action.
I'm going to look at entering FTNW at open around $1.15 - $1.20. My price target will be $1.20 - $1.26.
Feel free to leave a comment and let me know what you think!