Some of the stocks in Warren Buffett’s Berkshire Hathaway portfolio are now correcting near favorable entry levels where value- and income-minded investors can smartly buy in.

It is always interesting to look at the stocks that high-profile investment gurus like Warren Buffett are buying. Last year, however, was not a great year for Berkshire Hathaway (BRK.B), which was weaker than the S&P 500, losing 4.7%.

The weekly volume pattern in BRK.B does show some signs of accumulation, so 2012 could be a better year for Berkshire Hathaway. One of the stocks that Buffett bought more of in the first quarter, Bank of New York Mellon (BK), has had a rough two months and has dropped 16% so far this quarter.

Coincidentally, Buffett’s top holding, Coca Cola Co (KO), is also the largest holding in my “Charts in Play” portfolio, and two of his other top holdings now also look attractive for new purchases.

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Chart Analysis: The Coca-Cola Co (KO) made a high in April of $77.82 but dropped to a low of $73.47 last week. KO currently yields 2.8%. It makes up 19.7% of Berkshire Hathaway’s portfolio.

• The breakout in March above resistance at line a was very positive, and KO has retraced 38.2% of the rally from the January low at $6.56
• There is additional support at $72 (line a) along with the rising 20-week exponential moving average (EMA)
• The 61.8% support is now at $71
• Relative performance, or RS analysis, surged sharply on the breakout and shows a pattern of higher lows, line b
• On-balance volume (OBV) confirmed the breakout when it moved through resistance at line c. It is still well above its weighted moving average (WMA)
• Daily OBV (not shown) has dropped below its weighted moving average
• There is initial resistance now in the $75.30-$76 area

American Express (AXP) has corrected sharply from the recent high at $61.42 and has now dropped back to its rising 20-week moving average at $55. The stock makes up 11.6% of Berkshire Hathaway’s portfolio.

• AXP broke through longer-term resistance, line d, in the $54 area last March
• The relative performance line also made new highs in April, which is positive. It has good support at line f
• Weekly OBV was also able to overcome major resistance, line g, in March
• Daily OBV (not shown) did confirm the recent highs but has now dropped back below its weighted moving average, suggesting the correction is not yet over
• Next resistance for AXP is in the $57.30-$58 area

NEXT: Another Buffett Holding to Buy at Nearby Support

Technical signals suggest two of the most oversold stocks on the Nasdaq 100 are likely to underperform the broad markets, while two others appear to be good buys for after the ongoing correction.

The PowerShares QQQ Trust (QQQ), which tracks the Nasdaq 100 Index, was hit hard last week, declining 4.3% for the week, 1% worse than the Spyder Trust (SPY). QQQ is down 11.3% from the April 3 highs and closed last week just 0.6% above its weekly Starc- band.

Starc band analysis gives a reading of whether a stock is a high- or low-risk buy at the time. Close proximity to the upper Starc band (Starc+) means it is a high-risk time to buy since the stock is likely to at least move sideways, if not decline. Conversely, when a stock closes near its lower Starc band (Starc-), it is a high risk time to sell since the chances of a rebound are high.

For more on trading with Starc bands, click here.

The table below shows the 15 Nasdaq 100 stocks that are closest to their weekly Starc- bands. At the top of the list is Cisco Systems (CSCO), which closed last week 1.5% below its weekly Starc- band.

Just because a stock is oversold does not automatically make it a buy, as one needs to do further analysis to isolate those stocks that are in intermediate uptrends and where the relative performance analysis indicates they are outperforming the S&P 500.

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The top two stocks on the list have chart patterns and technical readings that indicate their recent strength was just a rebound within the major downtrends. Two of the most oversold stocks do look like long term buys on a test of more important chart and Fibonacci retracement support.

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Chart Analysis: Cisco Systems Inc. (CSCO) peaked at $27.74 in April 2010 and lost just over half its value by August 2011 when it made a low of $13.30. By early-April 2012, it has rebounded to $21.30, which was just above the major 50% Fibonacci retracement resistance at $20.52.

• It is important to note the 61.8% retracement resistance at $22.23 was not exceeded, suggesting that the rally was just a rebound within the overall downtrend
• CSCO plunged on May 10 in reaction to disappointing guidance in its earnings report
• It is already down 22.7% from its highs and has been below its weekly Starc- band for the past two weeks
• Next major support on the weekly chart, line a, is in the $15 area
• As CSCO was moving higher, the relative performance, or RS analysis, was flat, line b. It has now dropped sharply, indicating CSCO is weaker than the S&P 500
• On-balance-volume (OBV) has dropped below its weighted moving average (WMA) and failed to even reach the major resistance at line c
• Near-term resistance for CSCO now stands at $18

Teva Pharmaceutical Industries (TEVA) is a $33 billion maker of generic drugs. TEVA closed below its uptrend, line d, two weeks ago, and is down 16% in the past three weeks. This completed the continuation pattern.

• The rally from the 2011 lows just reached the major 38.2% Fibonacci retracement resistance from the 2010 high at $64.95
• Next support is between $36.88 and $35
• RS analysis declined, line e, as TEVA was moving higher. This was a sign of weakness, and it has continued to act weaker than the S&P 500
• Weekly OBV is also in a longer-term downtrend, line f, suggesting that the buying was weak on the rally
• There is first resistance for TEVA in the $41-$42 area

NEXT: 2 Good Buys for After the Correction