Potential Swing Trade...AFAM

This stock has been on my watch list for some time now. It has had a tremendous run-up over the past year, especially considering what the over-all market has done at the same time. Recently, AFAM's run has stalled and now it's entering the bearish stage of the trend cycle. This can potentially present a good opportunity to get into this stock at a price that offers a nice risk/reward trade. As you can see by the above chart, AFAM initially broke out of its overhead resistance, the blue line, and ran all the way up to $45. Now it is falling from its highs and the indicators are looking bearish. Their was recently a bearish cross on the MACD, the blue circle. Also the 10 period exponential moving average has started to point downward, which is a sign to sell. I would be looking to enter a long position in this stock around the $22-$26 range, somewhere within the green box at the edge of the chart. The $22-$26 range should offer some support because it's close to the break-out range and the price will be low enough to make several indicators give a buy signal. Once it touches the 26 level, I'll be looking for the MACD, BB width, and the moving averages to start giving bullish readings. Only time will tell, I'll give you an up-date in a couple of weeks after the stocks had time to play out. Good luck out there.

TLT