First Financial Starting To Look Good

First Financial (FFIN) is a regional bank that's located in down in the south western region of America. It's been a pretty strong stock in the last couple of years, especially when you consider the recent market environment.

The stock is starting to print an interesting chart pattern and it's looking like there might be a decent buying opportunity in the near future. Here's the daily chart:As you can see, there's a nice triangle pattern developing on the chart. The daily prices are converging into some major consolidation and there's looks to be some potential support down at the 200 day moving average. These types of consolidation patterns generally appear at pivotal points...points where the stock will sometimes launch like a rocket or drop like a rock. Remember that chart patterns do not guaranty anything, they just present higher odds of some kind of action occurring. The key will be to stay patient and wait for a break out. You can also take a look at a longer time frame chart to get an idea of what the stock has been doing longer term and to see if there are bigger patterns or trends occurring in the higher time frame. For stocks, I like to look at the weekly chart.
As you can see, there is some major consolidation on the weekly chart as well. Also, there is a long term trend that is still intact and prices are pulling right down to the trend line. Although the consolidation and the pullback to the trend line are both great signs, there are still a couple of bearish signals on this chart. First, the MACD is falling and there was a bearish crossing (the blue circle in the MACD window). Also, the BB width is over extended and seems to be declining. These bearish signs are not bad news, they just indicate that it might be a little early to take a position...the stock needs to recharge a bit.

I will be watching the triangle consolidation patterns on both the weekly and daily time frames and I'll also watch to see if prices respect the 200 day moving average on the daily chart and long term trend line on the weekly chart. If these levels hold and the weekly indicators become a little more bullish, I'll take that as a buy signal.

This is certainly not a great environment to be trading stocks on the long side but there are some good long term opportunities if you have cash and a lot of patience. First Financial has been a great company with superior performance on both the fundamentals and technicals and it's my opinion that it will be a good long term investment. This terrible market may provide a good opportunity to add it to an IRA or some other account of that nature.

Good luck out there.

TLT