Oclaro, Inc. (OCLR) is looking very interesting as a trading opportunity right now. The technical setup offers the best window into what traders can expect whether they are bullish on the play or bearish. We’re therefore exploring these deeper technical numbers with a view to helping traders make better decisions on the current trading prospects of OCLR. Before we get into the numbers let’s take a look at the importance of these numbers that help to make up the technical chart. When most traders face a challenge in picking the best stocks, they often resort to esoteric trading machinery – shorthand for getting to the heart of the matter. We have never mind this; in fact, we encourage it. The only recommendation we make is the tool used; for us, the technical chart is the ultimate shortcut.
OCLR’s position, when dissected using the very handy technical charting tool we’ve championed above, now looks very interesting. This position is opened up first by the stock’s current day’s high $9.00 and the accompanying day’s low $8.34. As things stand, the current day’s high means the stock is positioned negatively when matched against the prevailing 52-week high of $11.30 set by OCLR on 05/19/16. Given the range, and in particular the position of the stock’s low, we can make the assessment that the day’s low represents a 96.24% since 02/21/17. As a trader you can take this to mean something positive as it relates to OCLR latent upside potential and the opportunities, or not, that it provides for active traders. It’s not just traders who are taking a keen look at the stock, either. In the weeks and days of data amassed for the stock, a more open display of analysts. From their perspective, the stock has presented a compelling picture via data. This data has created a $12.33 for OCLR. As it stands, this target price is below the biggest gains set by the stock in recent times. Other important data is starting to inform the way analysts and traders see the stock. OCLR beta is currently 1.60. Traders that use the beta metric in their trading assessments of stocks know that the current beta for OCLR is greater than 1, and as such, gives clear directional bearing for upside. The current beta, as assessed below or above 1, suggests that OCLR is theoretically more volatile than the composite sector to which it belongs. At this stage you should start to see what is developing for the stock. Let’s move more inland; these metrics only scratch the edges
When data points of different varieties come together, the results can be truly spectacular. We are therefore going to use the next section to flesh out a stronger, more compelling picture for OCLR. Two of the most important technical indicators used by savvy traders are the Relative strength indicator (RSI) and Stochastic – both offer a deeper glimpse into the soul of the stock as it were. The present reading for OCLR 14-day RSI is 43.01%. What does this mean in real terms? A RSI reading at that level suggests that OCLR is neutral, suggesting that the stock is relatively stable and may possibly stay in situ, moving neither up or down in any meaningful or dramatic way. The stochastic reading is a sort of tag team partner for RSI. Usually they speak the same language in terms of telegraphing upside. For OCLR, the stochastic reading of 70.04% suggests that the stock is overbought at current levels. OCLR and its upside, of course, can be judged by tacking on even more salient technical data points. We are thinking here about the always-used statistical moving averages – namely the 50 and 200 SMAs. OCLR, on the strength of its moving averages, appears to present a sentiment worthy of being called bullish. And as go the sentiment around the SMAs, so goes the upside potential of the stock. In this case the sentiments appear to be positive.
So far we’ve put together, what we feel, is a pretty compelling image of the trading g prospects for the stock. But what if we could do more? Stick around because in the next section we’ll do just that. OCLR’s -0.12 has now created a much more confident set of data upon which traders can rely. This reliance is so pronounced that we can make a judgment that overall sentiment is now negative. This is hardly surprising for OCLR because further analysis reveals that the stock has actually outperformed the S&P 500 by 61.47. As a result of this performance the stock is now offering higher volatility levels when juxtaposed with similar stocks in its native sector. Based on the overall readings, historical volatility has placed OCLR in the front row for many traders. Again, this is hardly a shocker given that historical volatility for OCLR is 66.44%. OCLR is no slouch on the measure of the Average True Range, either. ATR, as you know, simply cannot be ignored in assessing a stock and OCLR offers a very clear reading with an ATR reading of 5.61. OCLR is as revealing it can be and those fine technical indicators used to illustrate its upside should never be taken for granted. Use them well.