Bullish on Cliffs Natural Resources

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Blackfly6

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Bullish on Cliffs Natural Resources

posted on Feb 19, 2010 05:16PM

Bullish on Cliffs Natural Resources

Technical analysis shows the commodity producer is set to rise

Ron Meisels & Monica Rizk

16:52 EST Friday, February 19, 2010

Cliffs Natural Resources declined from about $122 in July 2008 (A) to $14 in November of the same year (B) and then settled into a large trading range mostly between $14 and $32 (see dashed lines). The stock pierced above this range (C) to signal a breakout and the start of a new major up-leg and then rose to $55.40 (D). The current pullback should provide a good buying opportunity. Only a decline below the 40-week moving average (40wMA) (currently at ±$33) would reverse the current long-term up-side potential.

Point & Figure measurements provide a target of $59 (a 10-per-cent appreciation potential from current levels). The large area of accumulation (see dashed lines) supports higher targets.

Ron Meisels is a contributor to the www.NA-marketletter.com web site. Monica Rizk is the senior Technical Analyst for Phases & Cycles Inc. They may hold shares in companies profiled. Please see the site for a glossary.