The Dow has quickly turned around, and is now up 95 points. The turnaround is being led by 3M, up $2.00, and the other stocks that were on the brink of losing support like GE, Kodak, and IBM. The best performing sectors are oil service, pharmaceuticals, and semiconductors, but software continues to hold back the Nasdaq, down 3.16%.
The Best Offense is a Good Defense
Aerospace and defense stocks continue to get a boost after Alliant Techsystems posted better than expected earnings, and raised its profit outlook for 2002 and 2003 on Wednesday.
Alliant Techsystems Daily Chart
Along with beating earnings, ATK has announced a 3-for-2 stock spilt, and the stock is up another $2.70 today. That reverses the stock back into a column of Xs, and prepares it to give a quintuple top buy signal at $102. But $102 has been stiff resistance, and could also be viewed as the neckline of a head and shoulders bottom. For this aerospace stock to propel itself into the exosphere, it is going to need some extra thrust. Based on the bullish price objective, the projected apogee for this stock is $131. For that to be cancelled the stock would have to give a sell signal by trading $95.
General Dynamics Point and Figure Chart
General Dynamics (NYSE:GD), a recent Premier Investor bullish play, is also benefiting from ATK and a recent upgrade by SG Cowen. Today's $1.10 gain has added another X to the current column, and is $2 away from giving another buy signal at $86. The original buy signal at $79 gave a bullish price objective of $108, and GD would have to give a sell signal by trading $78 to cancel that.