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Wednesday, February 18, 2009 

Stock Picks and Trade Ideas for Thursday - RIO and Torchmark

Chart courtesy of www.stockcharts.com ( click to enlarge )

TMK - The technical chart looks bad. The MACD indicator is way below its signal line showing a bearish bias. There is no divergence in the MACD with respect to price movement, so it is not logical to expect a sustainable rebound at this level, even trading near the major support. ADX is at value of 46 and with –DI above +DI, it indicates a continuation of the downtrend. The RSI indicators is in oversold territory, but stocks that are in a downtrend will stay in oversold region for extended duration before rebounding. From now, with fundamentals weak and technical chart not showing any sign of rebound, it is best to avoid the stock until a clearer picture emerges. Stay tuned on TMK.

Chart courtesy of www.stockcharts.com ( click to enlarge )

RIO - Some danger sign is appearing on the stock. The rebound from early December has taken us from a low of 8.81 to a high of 17.85. The rally looks to be running out of steam. Looking at the daily chart the stock broke down on Tuesday a reversing three-month uptrend. In addition, the MACD cut below its signal line suggesting weakness in the short term. The +DI is also near to cross below the –DI line and the RSI has retraced back to the 50 level. The chart is not painting a good picture for Bulls. So do trade with care.

Disclaimer : Trading stocks involves risk, this information should not be viewed as trading recommendations.The charts provided here are not meant for investment purposes and only serve as technical examples.

That's all Folks. See you tomorrow !!!

AC

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  • I'm a 43 year old Independent Trader using proprietary technical analysis with more than 18 years experience of investing in the US stock markets. I started this blog in 2006 simply as a way to share my thoughts about capital, risk management, and trading. My blog contains only my personal opinion and is provided for informational purposes only.

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