TDMI Buy Setup

I like this trading idea.  The idea is to buy TDMI if it breaks its downtrend and rebounds off of the $3.75 level.  It is oversold, at an important support level, and has volumes that could signify capitulation.  The profit target would be around $5.50, and the stop out would be around $3.75.  It makes sense to have a sell target around $5.50.  There will probably be resistance there because it was a support level from early March through early July. It makes sense to have a stop-out just below the $3.75 level because there should be support there.  It was the top of the range last year from June though September.  It this level breaks it will probably head much lower.

 

Follow Up as of August 5th - A position was never taken because the downtrend line hasn't been broken.  Going to take it off of the watch list.