Network Appliance Inc. (NTAP +$0.15 or +0.28% to $53.75) posted another small gain today with light volume for a new high close. An upward trendline defines initial support above recent lows near $47 and its 50-day moving average (DMA) line. It has shown healthy action since its last appearance with an annotated graph on 9/08/10 under the headline "Gains For New Highs Today Backed By Nearly Twice Average Volume". Increasing institutional ownership (I criteria) is a very reassuring sign, having climbed from 308 top-rated funds in Sept '09 to 368 top-rated funds in Sep '10. There is no resistance remaining, making higher prices more likely for this high-ranked leader. However, its recent price/volume action is termed "wedging" as it has crept to new highs without great volume conviction. It has not formed a sound base pattern recently, and disciplined investors know that it is usually best to avoid chasing stocks that are extended from a sound base.  Patience may allow for it to form a proper base.

Recent quarterly comparisons (C criteria) showed accelerating sales revenues and strong earnings increases, but a down turn in its FY '09 earnings has been noted as a concern with respect to its annual earnings (A criteria) history. Long ago, this stock was featured on Thursday, March 30th, 2006 in the CANSLIM.net Mid Day Breakouts Report (read here). In May 2006, weak action resulted in it being dropped from the Featured Stocks list.