8 Nov

5 Light Volume Consolidation And Continuation Plays Under $2

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The key to making money on Wall Street and in small caps is to be first. The following charts are all consolidating after a recent move up and have a Relative Strength Index reading around 50. With small market caps and a solid chart, all that’s needed is the right news and anyone of these charts could pop to the next level. What I like about consolidation plays is that generally the risk to reward is in the swing traders favor meaning they should offer a tight stop at good support with decent trading ranges above. Here are five I’m watching this week.

FuelCell Energy (NASDAQ:FCEL) has a reported short interest of 6.5 days to cover and earnings are December 12, 2011. The chart shows a recent move up from $.80 to $1.11 or 39% before retracing -7% just above the 20 Moving Average. Resistance is at $1.11 and $1.30 with support at $1.00.

Capstone Turbine (NASDAQ:CPST) has a reported short interest of 19.4 days to cover and earnings on November 9, 2011. The chart shows a recent move up from $.85 to $1.13 or 33%. Price is creeping back up on the $1.13 level closing Monday at $1.11 with resistance there followed by $1.20 and then $1.60. Support is at the 20 and 50 Moving Averages followed by $1.00.

Coldwater Creek (NASDAQ:CWTR) has a reported short interest of 7 days to cover and earnings December 1, 2011. The chart shows a stair step pattern after their recent offering at $.85 walking up to where it is now at $1.13 or 33%. Resistance is at $1.13 and $1.16 before a move to $1.30 is very possible. Support is at $1.06 and $1.00.

Agria Corp. (NYSE:GRO) has a reported short interest of 2 days to cover although I suspect that’s gone up off the recent move and earnings on December 27, 2011. Shares made a big move in August from $.65 to $1.93 or 197% before retracing 38% to where it is today. Resistance is at the 200 and 50 Moving Averages ahead followed by $1.34 and $1.48 while support is pretty strong around $1.00. The chop and resistance points on this chart are my least favorite of the 5 plays on this watch list.

Cidedigm Digital Cinema (NASDAQ:CIDM) has a reported short interest of 1 day to cover and earnings on November 10, 2011. The price recently moved from $1.03 to $1.40 or 36% before retracing 11% to where it sits today at $1.25. Resistance is at the 50 Moving Average of $1.27 followed by $1.40 and $1.50. Support is at $1.22 and $1.16.

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