L-3 Communications Holdings Inc. (LLL) is a major global provider of command, control, communications, intelligence, surveillance and reconnaissance systems, and aircraft modernization and maintenance.
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L-3 consolidated following its fall from almost $115 in late 2008, and in mid-September, had a false breakout from a triple top after a string of high-volume days of buying.
On October 28, at $73.35, I said, "This pattern often produces a round of profit taking, which drives prices below the breakout point, and that appears to be the situation with LLL. Now at its 200-day moving average with a very oversold stochastic, LLL appears to be a good buy with a target of $95 to $100."
And on January 15, at $90, I said, "With the stock approaching those levels and looking as though it will continue its march higher, I would now like to adjust the target for LLL to $105 for traders and $110 for long-term buyers."
The market is giving us an opportunity to buy LLL following a break to the 50-day moving average and a lower price. Note the new buy signal from the stochastic.
I'll stick with my target of $105 for traders and $110 for long-term buyers.
By Sam Collins of OptionsZone.com
