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Play of the Day (For Thursday)
Interactive Chart
Wednesday, May 16, 2001

TTC - Toro Company $47.80 +1.30 (+1.81)

Tuesday's Comment:

Last week saw some surprisingly strong retail numbers that suggest that consumer confidence is rising. This has to be good news for Toro, as the company enters it busiest season for selling lawn and gardening equipment. TTC's modest advance today was accompanied by volume that was a little better than last week's anemic 20,000 to 30,000 average. Perhaps TTC is on the verge of finally breaking out of its very narrow trading range between $45.88 and $47.00. A rally above $47.00, accompanied by midday volume exceeding 30,000 shares, may provide the next good entry signal. If this occurs, TTC might find resistance at its 52-week high of $47.65. Hopefully, the rally will come soon because the MACD is threatening to issue a sell signal. On the plus side is the RSI, which continues to indicate that there is plenty of rally room before the stock would be considered to be overbought.

Wednesday's Update:

TTC finally broke out of an ascending triangle on Wednesday, accompanied by volume that tells us that this next move higher might have legs. While volume still came in shy of the three-month average of 90,000 shares, the 78,000 traded on Wednesday was a definite improvement over the anemic five-day average of 30,000. Toro had been building an ascending triangle with the upper triangle line forming resistance at $47. Now that TTC has freed itself from this bullish formation, the price target on the landscaping equipment maker becomes roughly $54. This target is reached by adding the height of the triangle at its thickest part ($7.00) to the top of the triangle at $47. In addition, today's $1.30 move higher kept the MACD from issuing a sell signal. Traders might consider initiating new positions on a bounce off $47 (now support) or a surge through todays high of $48 on volume of at least 35,000 shares by midday.

Picked April 29th @ $46.25
Change since picked +1.55
Stop Loss @ $43.50

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