NEW YORK (TheStreet) -- Good day, traders!
1. First, let's look at DryShips, the ocean transportation services for dry bulk and petroleum cargos as well as offshore drilling services. The company operates through dry bulk carrier, tanker, and offshore drilling segments.
DryShips traded up 3.54% on Tuesday to $3.51 per share.
- Tuesday's range: $3.34 - $3.55
- 52-week range: $1.65 - $5.00
- Tuesday's volume: 9,798,838
- 3-month average volume: 6,394,420
DryShips looks good from a technical standpoint, as it traded to form a bottom through April and May and is now starting to move. Back on April 30, the chart formed a bullish hammer candlestick and reached its 6-month low of $2.78. Then shares traded up above the t-line and tested the t-line for a month or so. DryShips kept tapping the low levels during interday trading. Then price action pulled back to test the low support level of $2.90.
On June 4, DryShips had a large bullish day, and the candlestick engulfed the previous month's candlesticks, which confirmed the bullish sentiment. This also implied that the stock will move higher. Price action traded up almost 22% from June 4's open.
Now shares are trading above the 200-day simple moving average. DryShips stock was consolidating until yesterday, when shares jumped up 3.54%. Yesterday's move cleared all near-term resistance levels. Now there is overhead resistance at $3.80, then again at about $4.00.
I'd look for an entry within yesterday's trading range, as to get it a little cheaper entry. I would set a stop as low as $3.20.
This chart has great potential. I would target the resistance levels I mention, but the ultimate target would be the 52-week high of $5, which is almost 30% to the upside. Now that's a great trade for a large cap stock, especially for one trading under $5. Stay long until you see a confirmed sell signal or a close below the t-line.
Next up: Medidata and Twitter.