Shares of Sohu.com (SOHU) moved mostly higher today, following a beautiful, classic bottoming tail formation on the chart yesterday. Bottoming tails are significant bullish signals that you should always look out for. This reversal in trend is major sign for technical traders, as the Chinese stock is trading at multi-year lows.

While the chart shows that the stock is setting up for a nice surge back to $17.35 in the near-term, it is particularly intriguing to note its total cash per share of $47.97. To state this clearly, the stock is trading at $13.50 while it has a total of $47.97 in cash per share. To put this another way, the market cap of Sohu.com is $530 million while it has $1.88 billion in cash. Based on these metrics alone, this stock is a screaming buy! Just in the near-term, I have an upside target of $17.50. Likely achieved within a month.

Sohu.com is a marketing/media company in China. Sentiment has gotten way too negative on this sector partly because of the China slowdown, but also because of the on-going trade war. As most analyst will tell you, the trade war will likely be over before the US presidential election in 2020. In addition, the amount of stimulus thrown at the Chinese economy by the Chinese government has been huge. This will start to trickle down into business spending. At the current valuation, Sohu.com makes a ton of sense as a bottom play with significant upside potential.

Take a look at the chart, it is one that any trader who understands the basics of chart reading will love to own!

Disclosure: Chief Market Strategist, Gareth Soloway of InTheMoneyStocks.com owns shares of Sohu.com (SOHU).

Gareth Soloway

Gareth Soloway

Chief Market Strategist Gareth Soloway has been an avid swing and day trader since his days at Binghamton University where he studied Economics. After college, Gareth quickly excelled as a financial adviser but his heart was always in swing and day trading. He had this long standing belief that he could help investors make more money by advising them on shorter term investments (holding a stock for days to weeks) than the buy and hold crowd who lost 50% of their money during every market collapse. “Why not profit during the bear markets just like the bull markets”, he said. While helping others gain financial independence during the day, he spent his nights studying charts and price action, developing a unique market trading system that put his profits on a rocket ship. Some nights he would barely sleep when he found a new technique that was proven, once back-tested.