Growing uncertainty over the ongoing debt talks in Washington together with a Fed report that said pace of economic growth moderated in many districts triggered a broad-based selloff that saw the major indices lost about 2 percents in Wednesday trading session.
Notably, shares of El Paso Corporation (EP) attracted strong buying support, gained 0.6% to 20.92 after the company announced early tender results, in which it will accepted all of the 9.625% Senior Debentures due 2012, and all of the 8.250% Senior Notes due 2016. This is definitely a positive sign going forward. In fact, as the chart below indicated, EP could climb above 25 and test the 38.2% Fibonacci retracement after breaking out from the so-called symmetrical triangle pattern. Just so that you know, initially profiled in our May 6, 2011 “Swing Trader Bulletin” EP had gained more than 13% and remained well position.
The graphic below is from our “U.S. Market ETF Trading Map”, which shows the near-term technical bias and trading ranges for EP. As shown, the underlying is in a short-term bullish trend when the price bars are painted in green. The underlying is in a short-term bearish trend when the price bars are painted in red. The yellow bars identify period of neutral or sideways trading pattern. Additionally, the light-blue shading represents the short-term trading range. A move above or below that range is considered overbought (as represents by the red shading) or oversold (as represents by the dark-green shading). Readings above or below the red and green shaded areas are considered extremely overbought or extremely oversold.
Chart 1.1 – El Paso Corporation (daily)
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