Chart of the Week - Int'l Container Terminal Services, Inc.

ICT Monthly Chart - Climbing Back Up but Approaching Resistances Near the 35.00 Level

Short-term Traders/Tsupiteros:	Medium-term/Position Traders:
Support - 27.00 / 28.50	Support - 24.25
Resistance - 31.00	Resistance - 31.00 / 35.00
Trend - Up	Trend - Up
Recommendation - Take profits but Trade the range	Recommendation - Hold / Take profits

Int'l Container Terminal Services, Inc. (ICT) has been in the spotlight in the last couple of weeks as prices have catapulted from the early 20s levels to 31.00 last Thursday in just one month's time. Let's see how its technicals look like.

You can see in its monthly chart above that the stock still has a way to go to its 2007 high at exactly 49.00. However, slowly, the stock has been climbing back up and is now at the mid-point of its 10.00 to 49.00 range. The chart also shows that there was a previous high at exactly the 34.50 level. This occurred in May 2008. Since that time, the stock has never climbed back up towards that level. You can also see that, at around that time, the stock sort of consolidated between 30.50 and 34.50. So, while prices did close the month near its highs and with a long white candle, it is now approaching some resistances at the early 30s levels.

What I'm a bit concerned right now for the bulls is the picture of its weekly chart. The weekly chart appears to be indicating that the stock may have encountered a brick wall at the 31.00 level. The 30.00 to 31.00 levels indicates that the stock's resistances in this time frame. Notice that everytime the stock tests its resistances (blue solid upper trendline), the stock tends to correct back down before eventually forming a higher high. Could it be the same this time around? With the stock's volume and volatility both increasing in the last couple of weeks, I would have to conclude that prices may probably correct or consolidate first for now.

The daily chart is showing people that prices are very much in an uptrend right now. For those who simply follow the trend, one may probably not notice a slight weakness in its behavior last week - the stock formed a bull-trap. What do I mean by that? On a normally bullish uptrend, when a stock breaks out of a consolidation, it should no longer drop back down below it. If it does, it is called a bull-trap and is usually the very first sign of weakness in an uptrend. This behavior occurred when ICT broke above its resistance at 29.00 and climbed up to as high as 31.00 but still eventually dropped back down below 29.00. This behavior may indicate an inability of the stock to trend up further. Thus, I would tend to think that prices may probably consolidate between 27.00 and 31.00 first for now.

So, how do we trade this stock? For Position-traders, you may either start taking profits on strength, or, just hold and use a break below the 27.00 level. A break below the 27.00 level may indicate that the stock will test its major support at 24.25. As for Tsupiteros, I sure hope you were able to take profits from this stock either last Thursday or early last Friday. If you are still holding your positions right now, you may have a bit of a dilemma right now because prices are already approaching strong support at the 27.00 to 28.50 levels. For those who would like to buy this stock, you may want to buy it as close to 27.00 as possible but just look to sell as close to 31.00 as possible.

Short-term Traders/Tsupiteros vs. Medium-term/Position Traders: Recommendation for short-term traders or Tsupiteros are meant to be used by traders whose holding period are limited to one day to two weeks. Medium-term or position traders are meant to be used by traders whose holding period are two weeks to three months. Long-term investors whose holding period is more than three months should not follow these recommendations.