Wednesday, January 24, 2007

Trade Ideas: RPF, DOW, BBH, RQI, CHN, WMB, SSS, TRK

Large caps closed at new highs, followed by decent gains in Tech and Small caps (but the latter indices are still caught inside prior congestion levels). The Trade Ideas scan completed the list of 8 stocks inside 1 minute - a healthy measure of bullish strength to Wednesday's buying.

However, only two picks: Dow Chemical (DOW) and China Fund (CHN) cleared the 20 appearance barrier at 20 and 25 hits apiece. Also, only two picks made bullish crosses of the 50-day MA by the 20-day MA: Dow Chemical (DOW) (again) and Biotech Holders (BBH).

The 1-year charts of some picks like C&S Premium Income Realty Fund (RPF) and Cohen and Steers Quality Income Realty Fund (RQI) [Answers on a postcard as to how these funds differ] look too extended to be taking a bite. Dow Chemical (DOW) looks to have emerged from a 2-month handle and is well placed to challenge 2005 highs of $53. Willliams Cos. (WMB) moves in steady steps - its most recent was a confirmed test of support at $25. The current move should clear $28 resistance and push on to $32. Scrappy handle consolidations are taking shape in Sovran Self Storage (SSS) - support $55/resistance $60/projected target of $65; and Speedway Motorsports (TRK) - support $38/resistance $40/projected target of $45.



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