Hello All,
GOT MILK?
At certain times, I'm drawn to classic defensive stocks. I discussed them in the past and you might recall I refer to them as the "Eatum, wearum, smokeum, drinkum, insurum, and take drugs furum kind of defensive stocks.
I hand chart a number of them, and thought some might like to see what I consider the head cow in the milk barn, Suiza Foods. I really like its FA and its acquisitions -- but that's not for discussing here, this heresssss fur chartn:
55
54
53
52 *
51 X *
50 X O * < Unofficial Bearish Res Line
49 X X O
48 X O X X 1
47 X O X O X O
46 X C X O X O
45 X O X O X O < High Pole
44 X O X O X
43 X O O X + < Revised Bullish Support Line
42 X * O X +
41 X * O +
40 X +
39 X *
38 X * < Bearish Support Line
37 X
36 X X
35 O X O B
34 O X O X
33 O X O X + < Bullish Support Line
32 O X O +
31 O X +
30 A X +
29 O X +
28 O X +
27 O X +
26 O +
25 +
You can see some of the trend line S&R as well as old horizontal S&R.
Had a triple top buy at 50, but the sell signal at 42 took away some of its luster. Recently reversed down to 45. And, unfortunately it's now in a high pole pattern (it's given up more than 50% of the previous column of X's). As Bruce has pointed out, 85% of the time this leads to a sell signal. But, with this stocks strong RS, it might not happen.
The first Bullish Resistance Line was taken out at 46, but the next one doesn't come into play until 64.
I like to take my charts and create what Mike Burke refers to as red zones (previous top areas) and green zones (previous support areas). These are important support and resistance areas. All stocks don't act like (you fill in the net name). Given that this stock was at 67 in March - and then went all the way down to 26 -- well it certainly is not at the top of its recent historical top area.
It's long term bullish (above the Bullish Support Line) and short term bullish (on a buy signal). Its bullish price objective is ((10*3)*1 + 41 = 71. Some might consider this a nice pullback, and if it reversed back up ---- might be worth keeping an eye on. That is, if ya like milk.
Take care,
Eric |
