Technical Analysis of Financial Markets

Friday, October 13, 2006

Overbought Financials (MER, GS, MS)

After a recent strong rally in financials, Merrill Lynch, Goldman Sachs and Morgan Stanley seem much overbought as they hover at their 52-week highs. An entry now into short-sell position for a possible 5% pullback in all three stocks may serve as a low-risk entry. Stop loss: Perhaps a $1 close above their respective current 52-week highs.

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