Technical Analysis of Intel Stock

Disclaimer

Forex, futures, stock, and options trading is not appropriate for everyone. There is a substantial risk of loss associated with trading these markets. Losses can and will occur.  I am applying a method that I use for Futures for the analysis of stocks.

Intel

Symbol: INTC

The stock is at a key decision point.  I highly recommend that you keep an eye on this one. The stock has been stuck in a channel for the past few months, and it broke out the top of the channel in the middle of January.  I would like this to break out of the bottom of the channel as well before turning around and retesting the highs, but that is not the only possibility. Technically speaking one of three things should happen, and it could make a great entry for a trade.

Bounce of Bottom of the Channel then Test the EMA
I can see this heading lower before finally reversing to test the highs.  I would be looking for a second entry off the bottom, meaning I want two see two attempts to head higher.  I would prefer it to keep heading lower and break out the bottom before making a second entry, but if it heads over 24.70 tomorrow it could retest the highs, and at the very least it  should head to test the EMA.  There would be a lot more shorts trapped to the downside if we broke the bottom of the channel before continuing higher, so I would be conservative with my profit targets.

There is also a little bit of a possible short trap that formed off the matching lows, but the there was only a slight increase in volume.  That suggests that not a lot of people took a short position at the level. Then again, if you look at the big picture and assume that people have been loading up on short positions over the past 4 days we could have a major move to the upside if they get squeezed.  Or are they going to be the power that push us down?

 
Head Lower
I could also see it heading lower if it breaks the trend line (kinda funny because that's what I want to see for it to head higher too).  The key difference is how the bars develop. If we break out the bottom of the channel tomorrow then the following day I would like to see a retest of the bottom of the channel that does not head higher then the previous days high.  If we get that the stock should head much lower on the third day.  If we do not get a retest of the bottom of the channel, then I would be looking to get long on the right step-up

Head Lower then Reverse
I would love to see a couple smaller bars down, and no retest of the bottom of the channel.  This is hard to draw because there are so many different ways it can happen.  I would expect it to look something like this, but it may head a lot lower before we get the first green bar.

Final Thoughts
It is possible something completely else might happen, but that is the life of trading.  This analysis is based on what I would expect to happen intraday within the ES, and it may not work out on a individual stock on a longer time frame.  This will be my first attempt trying to take this method and apply it to other instruments and time frames.