Monday, November 27, 2006

Trade Ideas: TLT, LH, PXP, RRC, CAM, NBL, ECA, CI

No guess as to who won today's battle. Greater damage was done to the large cap indices with downside breaks of 5-month rising channels; tech averages held their rising channels as did small caps (Russell 2000) - the latter index closing right on channel support in a manner similar to what it did at the start of November (and led to a 3-week rally). Unfortunately, the sting in the tail came in the level of buying; unlike previous Trade Ideas scans during down days when the degree of buying usually fell inside 30 minutes, today's buying covered a time span of 6 hours - a considerable time shift (but potentially contrarian bullish).

The 20 year treasury bond (TLT) was the only pick featuring over the last 3 hours of trading; it pushed 38 appearances. The remaining picks all ran under 20 appearances. Six picks all pushed recent bullish crosses of their 20-day and 50-day MAs: Laboratory America (LH), Plains Exploration (PXP), Range (RRC), Cooper Cameron (CAM), Noble Energy (NBL), and EnCana Corp (ECA).

As for the 1-year charts: There is a nice handle shaping up in Laboratory America (LH); support at $65, resistance at $70; short term target of $75. Plains Exploration (PXP) has support/resistance at $40/45 respectively; watch for a measured move to $62.50. Cooper Cameron (CAM) has formed a handle from a scrappy double bottom; look for projected move to $62.50 with a decent chance for some follow on to $67.50 - stops on a loss of $52. Noble Energy (NBL) could reverse to shape a double top, or follow through on a "V" reversal to make it to $58.50 - buy break of $50.



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