Friday, March 28, 2008

Catch a Falling Star

In regards to yesterday's recipe on Falling Star Stew, I've come up with some candidates that fit the criteria outlined in the recipe. To recap, the object is to find companies that have risen dramatically in a short period of time, have formed at least three peaks (four is mo' bettah), and with the final peak height significantly above its 200dma (50-100+%).

I found three candidates that look like they're starting to poop out and a slice through their 50dma's could be imminent. They're listed with their current price along with their peak percent above their 200dma.

BVN--Comp. Minas Buena.--------$71-------------55%
MTL-----Mechel Oao-------------$120------------87%

Actually, BVN and MOS both recently sliced through their 50dmas on heavy volume and both are on a technical rebound. If they break back down below their 50dmas, that would be the time to put on one of the short strategies mentioned in the recipe. (Either short the stock or buy puts.)

The following is a list of candidates that have risen dramatically and are trading well above their 200dmas but have not begun to break down as yet. Keep these on a watch list. Note that all of the stocks below are optionable.

CF----------CF Ind---------------$108-------------56%
ANR------Alpha Nat.--------------$43-------------59%
SID-------Comp. Sid.--------------$36-------------71%
WLT-----Walter Ind.--------------$63-------------62%
OFG------Oriental Fin'l------------$20-------------53%
JRCC---James River Coal----------$17-------------82%

That's about it for today. I'll keep these on a watch-list to see how they perform over the next few months. Maybe we can catch a few falling stars and put some profits in our pockets. That'll brighten up any rainy day!

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