Teaching Bats, Crabs and Sharks to Smoke
- Posted by Greg Harmon
- on September 17th, 2013
Tobacco stocks have been moving higher over the last two weeks, and a couple of Harmonic patterns suggest that they may have more room to run.
British America Tobacco, $BTI, found what many would call a double bottom August 28th. But this was actually a the makings for a Bat or Crab Harmonic. The Bat would support a rise to 113.26 and the Crab to 124 and change. The RSI and MACD support a move higher in this name.
Lorillard, $LO also looks good for more upside. This one is working through a Shark Harmonic. The Potential Reversal Zone allows for a move higher to 45.65 or 46.60. This also has support from the momentum indicators for more upside.
There is similar upside potential in Reynolds American, $RAI, Philip Morris International, $PM, and Altria, $MO. And don’t forget that the worst of thee carries a 2.6% dividend yield while many are over 5%. So who says it does not pay to smoke?
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The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.blog comments powered by Disqus
Gregory W. Harmon CMT, CFA, has traded in the Securities markets since 1986. He has held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)
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