Sapient (SAPE)

Company

"Sapient, a global services firm, operates two groups--Sapient Interactive and Sapient Consulting--that help clients compete, evolve and grow in an increasingly complex marketplace. Sapient Interactive provides brand and marketing strategy, award-winning creative work, web design and development and emerging media expertise. Sapient Consulting provides business and IT strategy, process and systems design, package implementation and custom development, as well as outsourcing services such as testing, maintenance and support." (company website)

sape(3-1
SAPE 4-month chart
sape(3-1)_1yr
SAPE 1-year chart

Buy

Sapient bottomed in March, and, beginning in July, has been trending upward in a fairly narrow channel. The 50-day moving average crossed above the 200-day MA in June, and the 200-day MA is rising now as well. The earnings announcement in early August was followed by several days of solid price gains.

  • Percentage price oscillator (PPO) — a bit below the signal line, but converging on it
  • Volume — all the above-average days since earnings have been up-days

Based on technical analysis, MarketEdge calls SAPE a "strong buy" in a "strong upward trend."

Sell

gain Bottom line
5%

Another one bites the dust! My stop-loss order kicked in this morning and booted me out of SAPE with a modest profit. Yesterday the PPO line took a decided turn toward the signal line, and today's sell-off just confirms the loss of momentum.

Before putting in my latest exit strategy, I probably would have held tight at this point — after all, the price is still above the lower limit of the channel in which SAPE is trading. The current up-cycle is about played out (3+ weeks), but in the past several months each retracement has been followed by another up-cycle.... It feels a little weird to be jumping in and out of stocks so quickly, but on the other hand, the monthly returns since the new strategy have been profits rather than losses. So, to hell with weird.