Due to the inconclusive short-term trend of the indexes and uncertainty regarding the earnings reports due out over the next few weeks there are few clearly defined opportunities available for trading where a stock has a strong/high probability factor, good risk/reward ratios, and clearly defined stop loss points.

The mentions below are conservative in nature and seem to be plays that should not be affected greatly by the indexes. This particular scenario will likely change soon as this seems to be the "calm before the storm".

UTSI (Friday Close at 4.63)

UTSI seems to have been successful in building a bottom and is now trying to generate an up-trend. On Tuesday it was able to get above the 100-day MA and that break was then confirmed with subsequent closes above the line. There is little resistance above until the 5.77 level is reached and a rally to that level is anticipated, if the support level holds up.

The 100-day MA as well as the 20-week MA are presently at 4.37-4.39 and should prove to be support on dips. The strong support is at 4.00 from the 20-day MA moving up as well as an important previous low on the daily chart. Resistance will be at 5.77 and then again at 7.39 and at this time it is difficult to predict if UTSI is strong enough to generate a rally up to the higher resistance. Nonetheless a rally up to the 5.77 level is quite probable.

Purchases of UTSI at 4.40 or better and using a stop loss order at 3.94 and an objective of 5.77 will offer a 3-1 risk/reward ratio. If UTSI is able to get above the 5.77 level and rally up to 7.39 the risk/reward ratio would climb to 6-1.

Based on the charts the rally up to 5.77 offers a rating of 7.5 (on a scale of 1-10 with the strongest probability rating being 10). A rally up to the 7.39 only offers a probability rating of 5.5.

RMBS (Friday close at 20.70)

RMBS long term weekly chart is now becoming quite clear and it offers a trading range that can be traded with limitation of risk and good profit potential.

RMBS has two very strong resistance levels. The long-term resistance level is 23.50-24.00 and the short-term resistance level is at 22.00. A very evident short-term support level is down at 17.31 and the long-term support level is at 12.20. It is highly probable that RMBS will be trading in one of those trading ranges for the next few months.

Last Thursday's rally up to 21.59 actually accomplished most of the upside potential, on a short-term basis, even though a rally up to 21.80 is still a possibility. At 21.59 the 100-week MA was tested and the stock immediately retreated from that area. There is a double top at the 22.00 level so shorting the stock with that level in mind, as a stop loss area, seems to be the way to go.

It is unlikely that RMBS will be able to get above that level unless the indexes rally strongly but if it does then re-shorting the stock on rallies up to the 23.50 level would be the way to go. The 23.50-24.00 level seems to provide a resistance that will not be broken unless positive fundamental changes to the company are released.

Sales of RMBS between 21.50 and 21.80 with a stop-loss at 22.10 and an objective of 17.50 offers a risk/reward ratio 5-1.

My rating on the trade is a 6.5 (on a scale of 1-10 with the strongest probability rating being 10). If stopped out and the stock re-shorted at 23.50 with a stop loss at 24.10 the rating would climb up to 8.

CEGE (Friday closing price 3.71)

CEGE is a stock that seems to have built a strong support base from which to start an up-trend. For the last few weeks it seems the sellers have attempted consistently to push the stock lower but have failed. A rounded bottom seems to have been built with the left shoulder at 3.35, the head down at 3.22 and the right shoulder at 3.37. A strong support level at 3.48 is in place and a very evident wedge formation seems to indicate that a breakout or breakdown is imminent and the likelihood is to the upside.

CEGE is now trading above all the MA's including the 100-day MA. On the 10-minute chart CEGE is now showing a clearly defined small trading range between 3.70 and 3.75 and a break above 3.75 will generate a move up to the 3.91 level. A break above that level will signal a strong buy signal. The way the stock has held support it seems likely the resistance levels will now be under pressure. There is additional resistance at 4.23 and 4.71 but those two levels need to be considered as minor. Major resistance is at 7.30.

Purchases of CEGE at Friday's closing price of 3.71 with an objective of 7.30 and using a stop loss at 3.16 will offer 8-1 risk/reward ratio. If a sensitive stop loss is desired, it can be placed at 3.42 thus increasing the risk/reward ratio substantially. It is unlikely that CEGE will get below the 3.48 level.

My rating on the trade is a 7 (on a scale of 1-10 with the strongest probability rating being 10). If CEGE gets above the 3.91 level my rating would go up to 8.5.

ININ (Friday closing price 22.93)

ININ has now broken out of a major 10-year resistance level and has no resistance of consequence above until the $33 level is seen. Breakouts have clearly defined guidelines and therefore offer a limitation of risk if the guidelines are followed.

The 22.26 and 22.42 breakout levels (daily and weekly closes) should now act as strong support and a close below those levels (22.26 on a daily closing basis and 22.42 on a weekly closing basis) should not be seen unless this is a false breakout. Since there is no resistance above the market for at least $10 the risk/reward ratio on this stock is quite strong.

Purchases of ININ between 22.26 and 22.50 and using an intra-day stop loss of 21.19 or a stop-close only stop at 21.84 and an objective of 33.07 will offer a risk/reward ratio of at least 10-1.

My rating on the trade is 7 on a scale of 1-10 with the strongest probability rating being 10.