XTO - Cross Timbers Oil $26.85 +1.23 (+2.02)
Cross Timbers Oil enjoyed a very strong day, even though gains in
the AMEX Oil and Gas Index (XOI) were modest. It is entirely
possible that XTO is a beneficiary of a consolidation trend within
the industry. Barrett Resources (NYSE:BRR) agreed to be acquired
yesterday by Williams Cos (NYSE:WMB), and, consequently, enjoyed a
nice spike up in its share price. Cross Timbers Oil and Barrett
Resources are similar companies because both are land based
regional drillers. Today's rally was technically significant
because XTO crossed over and closed above its 50-DMA of $26.41.
The last time this event occurred, XTO traded straight to $28.75.
XTO may test this resistance soon; therefore, additional positions
could probably be added tomorrow assuming XTO stays above the 50-
DMA and does not gap up to the $28.75 resistance on the open.
Today's volume of 888,700 was solid and we would be more
encouraged about adding to positions if XTO starts ticking up with
first hour trading volume exceeding 200,000 shares. Even more
encouraging is the fact that a rally tomorrow would likely cause
the MACD to issue a buy signal. Please note that we have raised
our trailing stop to $25.50.
Picked May 6th @ $24.83
Change since picked +2.02
Stop Loss @ $23.50
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