Today's Roof Leaker Stock Is Denbury Resources (DNR)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Denbury Resources ( DNR) as a "roof leaker" (crossing below the 200-day simple moving average on higher than normal relative volume) candidate. In addition to specific proprietary factors, Trade-Ideas identified Denbury Resources as such a stock due to the following factors:

  • DNR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $59.4 million.
  • DNR has traded 470,517 shares today.
  • DNR is trading at 2.08 times the normal volume for the stock at this time of day.
  • DNR crossed below its 200-day simple moving average.

'Roof Leaker' stocks are worth watching because trading stocks that begin to experience a breakdown can lead to potentially massive losses. Once psychological and technical resistance barriers like the 200-day moving average are breached on higher than normal relative volume, the stock may then be subject to emotional selling from investors that can continue to drive the stock lower. Regardless of the impetus behind the price and volume action, when a stock moves with weakness and volume it can indicate the start of a new, potentially dangerous, trend.

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More details on DNR:

Denbury Resources Inc. operates as an oil and natural gas company in the United States. The company primarily focuses on enhanced oil recovery utilizing carbon dioxide. The stock currently has a dividend yield of 1.5%. DNR has a PE ratio of 16.1. Currently there are 9 analysts that rate Denbury Resources a buy, no analysts rate it a sell, and 5 rate it a hold.

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