Rowan (RDC) Stock Drills to a Tradable Bottom: Shares Could Rise 20%
NEW YORK (TheStreet) -- Rowan Cos. (RDC) has made a tradable bottom on the charts and is poised to break an important downtrend.
Like other energy names, RDC has been declining for a while. The price action since July is interesting. The price action shows a minor low in late July and rally failures to $18. This is followed by a new low in late August with more rally failures to around $18. During September dips to $16 are bought. At the beginning of October, everything goes into high gear. RDC rallies sharply to $20, the 50-day Moving Average turns up and a pullback to the rising 50-day average is bought.
This chart, above, shows an improving On-Balance-Volume line, positive momentum and perhaps most important is that RDC is about to close above the 40-week moving average. Traders could go long RDC here looking for a rally to $25 for starters. A sell stop below $19 should work to control risk.