Linear Technology: Ready for some Upside?
Published on Tuesday, 22 May 2012 08:24 Written by TradersHuddle Wire
New York, May 22nd (TradersHuddle.com) - Shares of Linear Technology Corporation (NASDAQ:LLTC) ended the trading session higher by $0.42 or 1.45% from its previous close. Linear Technology's price action developed what can be considered a reversal pattern in the form of a tweezer bottom, which is a candlestick pattern that is usually formed at the end of a downtrend. The tweezer bottom is considered a reversal pattern, so traders will need to monitor the price action for confirmation.
Linear Technology Corporation (NASDAQ:LLTC) designs, manufactures, and markets a line of linear integrated circuits. Its products include high performance amplifiers, comparators, voltage references, monolithic filters, linear regulators, DC-DC converters, battery chargers, data converters, communications interface circuits, and RF signal conditioning circuits.
Traders looking for an entry in Linear Technology can use the tweezers as a good reference point to establish the long position, as the pattern provides defined risk by giving a good reference point for support.
Traders look for tweezer bottoms, as they provide an entry with a small defined risk. They are a leading indicator that provide an alert for a trend reversal or stabilization. The tweezers imply that bears or sellers were not able to push the stock lower, therefore providing the opportunity to look for a bounce. Below an example of a Tweezer Bottom reversal pattern: