4 Stocks to Buy Right Now at Support Tickers in this article: ISBC, BLL, CDK, IPXL "Support" in trading refers to a level or price area where the price had a tendency to bounce or rally off of. It could be an exact price or it can even be a drawing, like a trendline. When a stock is in an uptrend there may be a rhythm to how often, and how far, it typically pulls back. A trendline highlights this tendency. Whether the price has shown a tendency to bounce off a trendline or a specific price area, these four stocks are all trading near support. With the overall trend up, that presents a buying opportunity.
Investor Bancorp Inc. (ISBC) 
Investor Bancorp Inc. (ISBC) is moving in a tight upward trend channel throughout the year. In early July a pullback brought the price to the bottom of the channel, and so far the price has bounced off it. That indicates the rising trendline (area) is still providing support. While it can sometimes take several months, the tendency for the stock has been to bounce off the channel bottom and then rally to the top of the channel. The top of the channel is currently near $12.95, which could be used as a profit target. Ideally enter long between $12.20 and $12.30 with a stop loss below $12.10.
Ball Corporation (BLL) 
Ball Corporation (BLL) is in a long-term uptrend but since February has been moving in a narrowing range. Based on where the price bounced in March and June, there is a support area between $69.75 and $68.75. More recently the price has bounced off $69.50. If the price moves above the July 14 high of $70.84, that provides evidence the support area has held again and the price is moving higher. Potential resistance isn't far, at $72.25, which is the top of the narrowing range. If the price breaks above that though the target is $76.35. That target is just below the major February high at $77.20, likely a strong resistance area.
CDK Global, Inc. (CDK) 
CDK Global, Inc. (CDK) has bounced off its rising trendline four times since its current channel began in late 2014. The price is currently testing the channel low for a fifth time. After pulling back to $52 the price has consolidated (July 8 to 14) just above the trendline, The high of this multi-day consolidation is $53.94, so a rise above that could indicate support has held and the price is rallying back toward the top of the channel. The top of the channel is near $59, so a reasonable profit target is just below this, at $58.50 to $58.75
Impax Laboratories Inc. (IPXL) 
Impax Laboratories Inc. (IPXL) rallied strongly from below $24 in October to $52.10 in April. That was were the stock peaked and it has been moving in a triangle pattern since. Through the end of June and early July the stock looks to have put in a short-term bottom, finding support just above $45. Buying between $47 and $46 is one option, with a stop loss below $45. That requires a pullback, and currently the price is moving towards the breakout point of the triangle at $49.20. If that breakout occurs, the target is $58.50. That's attained by taking the approximate height of the triangle (rounded down) and adding it to the breakout price. With a target more than 18% away from the current price ($48.55) this is a potentially longer-term trade.
The Bottom Line Buying near support in an uptrend is one potential way to trade. Some traders prefer buying on breakouts above resistance, or using technical indicators. Ultimately, each trader must find a method they like, practice it, and then find stocks that provide that setup. The four stocks above have recently pulled back to support, offering buying opportunities with a stop loss below a recent low. Each one has a chart pattern or trend channel which also provides a potential profit target area. Trends do reverse, and support can break. Only risk a small percentage of account capital on any single trade.
Refine Your Financial Vocabulary Sign up to receive our FREE Term of the Day newsletter. Gain a better understanding all things financial with technical and easy-to-understand explanations. Click here to begin developing your financial language with this daily newsletter. Disclosure - At the time of writing, the author did not own shares of any company mentioned in this article.
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