Addon Buy:(FUQI)

I had been concerned that (FUQI) would pull back today and stop me out after making such a dramatic move over the past couple of weeks, but instead it gapped up at the open again and never came back to yesterday's close. In fact, it ran up to almost $13 before closing at $12.34. I adding to my position with my second and final buy at $12.10. I'm prepared for this type of volatile action, after all the stock has doubled in two weeks, plenty of traders are going to want to take profits. What I'm trying to look for is the stock to find some sort of temporary support area and ideally consolidate it's gains before pushing higher.

The stock is almost twice it's 50 dma and 200 dma, and that's why I'd like to see it take a bit of a break. The 50 dma is about to cross the 200 dma and they are both trending up, which is also technically bullish.

IBD has featured (FUQI) several times with various comments to the effect that the stock hasn't formed a proper base. I knew this was true when I purchased, but I tend to value clear accumulation in a chart far more than a perfect pattern. I'll learn over time whether or not that's a mistake.

The general market still offers reason to be concerned, five distribution days on the Nasdaq is nothing to ignore. However the other indices are doing well, and there is a particular setup that I'm watching with great interest. The Nasdaq 50 dma line is about to cross the 200 dma. My understanding is that many technicians look for the 50 dma to be above the 200 dma and the price to be above the 50 dma as a green light to buy stocks. Though the markets have been consolidating gains for the past few weeks, they could get a push higher once the moving averages line up this way in the next week or two. I'm anxious to see how this plays out.