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Amsouth still looks bullish

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Last week, PremierMarkets.com added shares of Amsouth (NYSE:ASO) to our profiled portfolio when the stock traded $18.50 and broke above bearish resistance or longer-term downward trend. Recently, banking stocks have been acting well and that's what got PremierMarkets.com beginning to scour banking stocks that were looking strong. Subscribers can see from the chart below that any overhead stock dates back to 1998 and 1999. The question is.... "how much of that stock is still in the market place at levels from $21-$34?" We never now the answer for sure, but considering the stock got drilled to a low of $12 back in October of 2000, it may not be a leap of faith to say that there may not be a lot of stock owned at levels higher than current trading of $18.50. If so, they've held this long and may continue to hold now that stock is acting better.

Amsouth Bancorp Chart - $0.50 and $1 box

PremierMarkets.com view of ASO wouldn't have been nearly as bullish if overhead stock at $21 or higher had dated back less than 6-months. Considering that overhead stock dates back nearly two years or more, this has us viewing supply/demand much differently. It's entirely possible that the stock got drilled to the $12 level back in October of last year due to tax loss selling by those holders dating back to 1999.

Jeff Bailey
Senior Market Technician

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