Brocade Communications could breakout its USD 9.7 resistance.

The economic and financial situation of the company is strong. Analysts which are forming Thomson Reuters consensus are regularly revising their EPS estimation for 2013 and 2014 (respectively +50% and +30% for one year).

Technically, the security is in an uptrend on all time scales and it is supported by moving averages. The bullish trend will not be stopped until prices are above the USD 9.18 short term support. This trend should allow the stock to breakout the USD 9.7 resistance, which will give a buy signal. By the swing effect, the target will be placed at USD 10.3.

In consequence, investors can take a long position in Brocade Communications Systems with a first target price at USD 10.3. This level will be reached after the crossing of the currently tested resistance (USD 9.7). A stop loss will be set under the pivot point at USD 9.48.