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Different patterns have a habit of forming during different market phases and cycles.  Sometimes it’s bottom formations such as Saucers, reversal patterns such a Head & Shoulder Bottom, and at other times it may be Darvas Boxes.  The current pullback in the market appears to manifest many bullish Flags and Pennant Continuation patterns.  These present opportunities for the short term trader.  Here’s a few of them:

AIM - Amex.  Pennant Up. Pattern target price around 8.50.

BOBE - Nasdaq.  Flag Up. Pattern target price around 37.00

DLLR - Nasdaq. Flag Up.  Pattern profit target around 17.00

OYOG - Nasdaq.  Flag Up.  Pattern target around 29.50

SIGA - Nasdaq.  Flag Up.  Pattern target around 9.50

With so many stocks breaking out and rising, I thought I’d discuss a few setups that currently offer low risk entries, and where possible, technically measurable profit targets. In particular, I’ve identified the following NYSE traded stocks of interest: ARA, AHT, AKS, GNW.

ARA - This is one of many charts of a stock that was heavily sold off, formed a decent bottom and is now being accumulated. Notice the significant change in trading volume and the higher-highs, higher-lows in the last 2-3 months. OBV is rising showing control of the buyers in this stock. There’s a decent gap to fill up around the $45 level. Clearly a breakout of the early May high, or perhaps for the more conservative, a close or two above the $20 level would be a good technical entry into ARA.

AHT - an ascending triangle with depth of 1.25. Pattern target around 5.50.

AKS - very similar to the chart of ARA. Another stock being heavily accumulated. Profit target in the short term around 25, medium and longer term target around 50.

GNW - here we have another example of a rising stock. Higher-highs, higher-lows and now a tight Darvas box formed on good increase in volume. A breakout of the top of the box would signal a suitable entry into GNW.

NKP - NYSE.  National Preston Inds Inc. has formed a Darvas Box at all time high of 81.00.  Strong rising OBV and increased volume activity over the last year shows the buyers firmly in control of the stock.  A breakout of 81.00 would signal a technical entry into NKP.

Been having a look at some of the resource stocks trading on the AMEX and found the following stocks.  All are showing recent breakouts accompanied by rising volume and strong rising OBV.  This is typically a healthy sign of accumulation.  ANV, AXU, ETQ, NAK, NXG, WGW.  It’s a matter of finding a suitable entry now that fits your trading plan. 

Friday’s scan revealed a number of Flag Up continuation chart patterns on stocks on the NYSE.  Here are the charts.

FMD - profit target around 3.50

HLX - profit target around 11.40.  There are a number of overhead gaps to fill up to 20.00!  Could well have a fair bit more in it on a close above the 10.00 psychological level.

OCN - profit target about 14.00

NYSE: Stocks to keep an eye on - ACL, ALV, AMG, ANN, ATW, BCO, BGC, BRY.

There’s a lot of stocks that have broken out of their bases and are begining to move up. Here’s a few to keep an eye on for suitable entries on the AMEX: AZC, BAA, END, NOG, TGB, VTG. All showing the classic tell tale signs of rising volume, breaks of new highs, pullbacks on low volume.

CMG - NYSE.  A chart of Chipotle Mexican Grill Inc. shows a potential Cup and Handle bottom formation with resistance at $68.00.  The depth of the chart pattern is about $28.  Pattern profit target therefore can be projected to around $96 (68+28).  Volume must expand on the breakout to complete the formation.

NFX (NYSE).  Newfield Exploration Co.  This stock has formed a nice bottom after falling from around $70 last year.  Since the October 08 lows, the OBV has been on the rise and now volume itself is on the rise and a nice 4-5 month resistance line has formed.  A breakout of this resistance or alternatively, a close above the $25.00 level would signal a good technical entry for the medium to long term investor.

LZR - Amex.  Emergent Group Inc.  Keep an eye on this stock.  We’ve had a massive volume change accompanying a rise in price to 10 dollars, followed by a pullback on low volume.  Price and volume are once again on the rise back up to the 10 dollar level.  Rising OBV shows clear sign of strong accumulation.  A breakout and a close above 10 dollars could be the start of a large upwards move.