Bullish Action in Juniper Networks

Juniper Networks (JNPR) is moving well today. The networking stock is up more than 3% on healthy trade and has moved past its November highs. This breakout type move extends the very solid rally the stock has been tracing out over the last three weeks. In mid-November, the shares were testing the $16.00 area, a key support level that also held the October lows, before mounting the current recovery rally. With today's surge, the stock is now up nearly 20% from last month's lows and is setting up well for more upside.

All year, JNPR's 200-day moving average has delivered extremely heavy overhead resistance. This key level has capped monthly highs in February, March, April, May, September and October. The most damaging rejection came at the April/May peak. JNPR collapsed to fresh multi-year lows during a 35% drop before finally hitting bottom in July. Following a major jolt of bullish interest later that month, the stock has been consolidating. If this week's positive action can hold, JNPR may be leaving behind a major bottom near the $16.00 area.

Juniper Networks (JNPR) -- Daily

Source: TradeStation

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Today JNPR is moving further through its declining 200-day moving average than it has been all year. The stock, which will post its third straight positive day on above average trade, is leaving behind layers of support in the process. Recent catalysts sparking this increased interest include aggressive insider buying as well as positive comments from UBS. Nearby is the $18.50 to $18.00 support zone, which includes the 200-day MA as well as the November highs.

Considering the size of the current rally, as well as supply near the October peak, I would expect some back-and-forth movement in the near term. I am long the stock and will be a buyer on a pullback. The next upside target is $20.00 -- the September highs. This will be a logical area to take some profits.

At the time of publication, Morrow was long JNPR.