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Christian Tharp, CMT

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Five Star Stock Watch: Yahoo!, Inc.

Like most of the big tech names, Yahoo! stock has had a great year.

Over the last 12 months, the stock has climbed from $17 to a recent high of $40. If you owned Yahoo! stock in 2013, you've done quite well!

What traders and investors need to know now though is whether or not the stock can rally higher. Believe it or not, Yahoo! has been somewhat consistent in answering that question, as can be seen from the chart below.

Related: Five Star Stock Watch: Twitter

The company: Yahoo!, Inc.

Ticker Symbol: (NASDAQ: YHOO)

Sector: Technology 

Industry: Internet Information Providers

Yahoo! Inc. provides search, content, and communication tools on the Web and on mobile devices worldwide. It operates Yahoo.com that offers categories such as Yahoo! Search, Yahoo! News, Yahoo! Finance and Yahoo! Sports.

Please take a look at the one-year chart of Yahoo below with added notations:

You can see from the chart above that the last two significant pullbacks in Yahoo! started once the stock hit an increment of $5. In July it was $30, in October it was $35. So, is it really surprising that Yahoo! has been stalling at $40 recently?

If the trend holds true, Yahoo! should be primed for a pullback before breaking higher, if it does at all. However, a present move above $40 should mean another run-up is underway, most likely to $45.

Related: Five Star Stock Watch: Priceline

Yahoo! is set to release earnings in January 2014, sometime during the last week of the month.

No matter what your strategy, or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!

Posted-In: Education Long Ideas Short Ideas Technicals Tech Personal Finance Trading Ideas General Best of Benzinga

 

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