CLNO – The Bounce is Upon Us

Our chart alert is Cleantech Transit, Inc. - CLNO

CLNO has a mandate to create opportunities utilizing advances in technology and manufacturing processes in order to develop significant market share in the alternative clean energy sector.

For more information on the fundamental components of CLNO, you can check out their website at or their Yahoo Finance page by clicking here.

Below you can see the technical chart. Be sure to scroll down below the chart to get additional commentary regarding our thoughts.

There are many ways to analyze a chart, but at the end of the day when all is said and done, there are really only two types of charts. You either have one “in action”, or you have one where you are “in wait mode”. With CLNO, the waiting is over, and the chart is just sprung into action!

Until today, CLNO had been “in wait mode” for a long time. Since mid April, the chart has been “waiting” for not only for the price to stop falling, but also for confirmation of a true bottom. Well… the wait is officially over! What gives us the confidence to make that claim? Easy. Check out the volume and price action yesterday! The price had been going sideways for essentially an entire month straight while it formed its bottoming channel pattern (brown lines). With the new breath of life that has entered the chart (check out those last two volume bars!), the bottoming channel pattern has been shattered and now the price is heading back up with what is looking to be a very strong bounce.

This brings up the obvious question, how can we tell how strong the bounce is? Once again, by using the chart, this is an easy question to answer. The more resistance levels the price crushes, the stronger and stronger the bounce will become. With that in mind, keep a close eye on both the 50-MA and 200-MA. Both of these are the current level of resistances, and these are the type of levels that when the price gets above them, they set off the alarm bells on trader’s scanning software. Traders love a good ole fashioned bounce, and as these resistances fall, it will call more and more attention to the chart.

To add a bit more of fuel to the first, consider where the price was back ONLY a couple months ago in April: $.135. Given where the price currently is, and given the bounce has just begun, if this chart doesn’t scream the word “POTENTIAL” at you, we don’t know what will! Remember, the price has literally just broken out from its channel pattern, so we are still at the beginning of what we hope will be a very exciting party!

The MACD has a very pretty little uptrend to it, so although price and volume are our two main concerns, it’s always nice to have additional confidence from the MACD, and finally, check out the money flow!

During the bottom channel formation, the Money Flow Index (MFI – measures direction of cash flow) had been forming an ascending triangle pattern. Again, MFI certainly isn’t the most crucial indicator, but it also certainly doesn’t hurt the confidence levels when you see it breaking out of its bullish pattern! Seeing this breakout really shows that the money is just beginning to flow in, and there will hopefully be much more to come!

As we pointed out in our email to you yesterday, our track record has been very solid, and with a chart like CLNO that is just beginning to bounce, our hopes for “3-in-a-row” are very high! Get CLNO on your radars immediately!