Strong Stocks with More Bullish Potential Tickers in this article: DE, SWK, NMR, MANH Even when the price is trending higher it has periods where it moves higher and lower within that trend. During an uptrend it is traders who buy near support that get the best price before the price continues higher. There are no assurances that support will hold in the future though, and once in a trade the price could break support even though it appeared it would hold. Despite the potential drawbacks--and there are risks no matter when or where you take trades--buying near support in an uptrend is a viable method for traders to consider. Here are four trending stocks, currently trading near support.
Deere & Company (DE) 
Deere & Company (DE) is trading near two support levels, one based on a rising trendline intersecting at $92, and another based on the July swing low at $90.64. The two support levels create a support zone between approximately $90.64 and $92. On August 13 the price fell to $91.56 before rallying 1.33% on August 14. This sharp reversal near support may indicate the short-term pullback is over and the trend is about to resume. Control risk with a stop loss, placed below either the July or August swing low--depending on your trade time frame and overall expectation for the stock. Minor resistance is between $97.50 and $98.23, creating one possible target. Longer-term, if the price breaks through resistance the top of the current trend channel provides a target at $99.50 to $101.50. If willing to hold through a number of price swings a higher target can be used.
Stanley Black & Decker, Inc. (SWK) 
Stanley Black & Decker, Inc. (SWK) is respecting a rising trendline since the start of the year, and the price is currently right near it. $102 to $103.50 is a likely support area based on the trendline and July low at $101.94. In August the price has held in this region, indicating support is still present. Buy between $105 and $104 with stop loss below $103 or $102. The top of the trend channel puts the next target at $112.
Nomura Holdings, Inc. (NMR) 
Nomura Holdings, Inc. (NMR) is in a rising trend channel since the start of the year, and in August has pulled back to channel support (bottom of channel). Based on the trendline and price action from May and June (old resistance acting as new support), $6.80 to $6.90 is the support area. Consider purchases in this area--or holding current longs if support holds--with a stop loss below $6.70 or $6.60. Target based on the trend channel is $7.50. This stock is recovering from a sell off in 2014 though, and there is resistance near $7.40, just before the target. If resistance is cleared though the long-term downtrend has reversed.
Manhattan Associates, Inc. (MANH) 
Manhattan Associates, Inc. (MANH) has been a steady riser since September 2014. In August the price is finding support between $64 and $62. This is one potential buy area. The price is still slightly above the trendline, indicating the price could pullback to $61.50 to $60.50, providing another buying opportunity. Waiting provides a better reward/risk ratio. A stop loss is placed below a recent swing low, depending on which entry is taken. The stock is rising in a tight channel, meaning the next price swing higher is likely to reach $69.50 to $70. If looking for a bigger profit the trade will likely need to be held for the longer-term, allowing the price time to grind higher within its channel.
The Bottom Line Some traders like to buy on new highs--a breach of resistance--others like to buy near support in anticipation of the uptrend continuing. Both are valid if risk is controlled and profit potential outweighs risk. These stocks are currently trending higher, and are near support---based on prior price action. Whether support will hold or not is unknown. That's why a stop loss is used to help limit risk in the event the trade idea doesn't work out as expected. Only risk a small percentage of account capital on any single trade.
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