Standout earnings produced a big gap up, and the retracement into good support means traders now find a very favorable risk/reward set-up right before them.
F5 Networks, Inc. (FFIV) had earnings back on April 20 and reported strong numbers with second quarter revenue up 34.7% year-over-year. This report gapped the stock up nicely and has since been grinding lower to fill that upside earnings gap.
The $100 level looks like an actionable support level and I will be a buyer with an exit below the $99 level.
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Below $99, I see no support until the low $90’s area. This is not my favorite set-up on pure technicals, but I believe the risk/reward is very good and that $100 price level should hold.
The recent two-day pullback in the market—especially in tech stocks—has not phased FFIV.
My first target is the $106.50 area and then the $109 region.
By Marc Sperling of T3Live.com
