Evening Thread



BahiaBaby is reading charts tonight so if you would like her input throw out a question on your stock.

Afternoon Thread

Last time she tailgates that truck.

Things are likely to change very quickly if we get news from Europe.

Morning Thread

Gator's Chart of the Day: CLF

Cliffs Natural Resources (formerly Cleveland Cliffs) used to be a weekend takeover target for the rumor mills.  Never happened and now it doesn't get that kind of press but Barron's did write a very positive article on it over this past weekend.  This was in spite (or ignorance) of the company's own lowered guidance for 4Q 2011 prices of its iron ore.  Cliffs expects to report $120/ton while current market prices are around $139 per Barron's.  This suggests significant upside going forward and with a forward P/E of 7 the company already trades well below the steel industry average P/E of 11.5.  Credit Suisse lowered the price target to $82 from $93 while Deutsche Bank has it at $110.

The daily chart (above) shows the smack down in price after the Thursday night announcement.  The stock opened at the low of the day and traded higher 'til a little after 2PM and gave back 75 cents from there to the close.  Volume was very high with 25% of the action occurring in the first 15 minutes of trading.  It looks like traders are respecting $70 as support and the 20 day sma is just below that at $69.71 and the 50 day at $67.43. 

I'm looking for a retest of the 20 day or maybe the 50 day where I think the stock will bounce.  That is my preferred entry. If it does not pullback but instead moves on toward the 200 day sma ($76.90) I won't chase it as it failed there the last couple of times.