Bullish on VRSN

VRSN stock chart from freestockchart.com

VRSN (Verisign Inc) has been in a nice uptrend since the end of September 2011. Back then the price of VRSN was $27.50, now it is $40.31. The Stochastics and MACD were showing mostly over bought levels during its slow rise, but it has finally come down to over sold levels and it might just be a good time to get in. RSI is almost showing over sold levels. I also found a nice upper and lower trend line which I drew in and can be seen in the chart above. The Parabolic SAR is still indicating a downtrend, but that can soon change, wait for confirmation. Bollinger Bands are also looking tighter and should expand when the price goes higher. Another sign that this stock is in an uptrend is that the price is above the 200 day and 50 day moving average, but below the 20 day moving average. The stock price has almost hit the lower trend line and that's the area that needs to be focused on; between $39.80 and $40. There's a possibility it wont come down to that level and the stock will continue to show strength after Friday's .37% rise. This can be confirmed with volume, Stochastics, MACD and a RSI cross. Once VRSN turns back up to the upside, we can expect a price anywhere in the $44 area. However, if VRSN comes down to the lower trend line and crosses below it, we may be in a new down trend. What I like to do is take profits once that price of the stock has increased a $1 from the initial purchase. If the stock still seems bullish, I stay in longer after verifying it's still safe to hold the stock. Remember to set up stop losses, they really help! Good luck and happy trading!

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