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Friday, June 01, 2007

Keep An Eye on IR

Late Apr, I talked about 3 stocks to watch for potential breakout. IR was one of them. It was then forming an ascending triangle and had a false break with its earnings announcement. As I've said in that post, I don't recommend holding positions over earnings announcement and this chart is a good example why you shouldn't. Because if you held it as swing trade and didn't profit take, then you would have been stopped out for a loss on 30/4.

IR then went out for a real breakout and on 15/5, it gapped up nicely on news that it is exploring strategic alternatives for its Bobcat and Construction-related businesses. It then went on to test the low of the gap several times and defended it successfully. $48 is now a strong support. Continue to keep this stock in your watchlist as it has strong technicals and also the chance for potential spin off means it may gap up again if it materializes. Look for pullback.

IR also presented a low risk intra day trade opportunity yesterday. The first chart is a 15 min chart, followed by 5 min chart. Jamie has traded many of such base & break setups. Check out his blog for more examples.


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