Rowan Cos. (NYSE:RDC), a major offshore driller, traded gently higher today as shares continue to emerge ever so gently from their trading range of the past two and a half weeks. The energy sector overall appears to be a mixed bag, but as you can see from RDC’s daily chart, this stock can really move once it gets going.
The stock is trading just above its 50-day moving average, and it appears ready to launch one of its big advances now, similar to the rally out of a channel like what we saw in January-February of last year.
With open interest for February $36 call options over 3000, I’m not the only one anticipating a move up in this stock. It’s been trading just above its 50-day moving average for a while now, and based on its history, I’m seeing a quick spike upward. The company reports earnings on Feb. 25. So just sit back and wait for the ignition to rev up on this trade.
Recommendation: RDC looks great for an entry at current levels and a $37 target.
InvestorPlace advisor Jon Markman operates the investment firm Markman Capital Insight. He also writes a daily swing trading newsletter, Trader’s Advantage which aims to capture profits of 15% to 40% and often as much at 100% to 200% in less than 90 days.
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