Coinstar (CSTR)

We’ve profiled this company numerous times and still believe it has a chance to join the cast of market leaders. Our last trading post in September never triggered. You can read our original write up on the company and rationale behind having it in your portfolio here.

CSTR appears to be triggering a legitimate long entry today. The stock has carved out a double bottom pattern and is moving higher today on volume past a “Shake Out Plus 3” buy point, which is defined as about 13% or so above the lows of the first leg of the “W” pattern. This is just north of $34. Our ideal entry point would be above the highs of the September shelf around $33.50.


The pattern is odd shaped, but bears a striking resemblance to WMS that gave us an excellent trade earlier this year. In a field where history often repeats, this could augur well for the trade.