Is Rowan Companies Breaking Out?

Published on Friday, 27 April 2012 08:16 Written by TradersHuddle Wire

New York, April 27th (TradersHuddle.com) - Shares of Rowan Companies, Inc. (NYSE:RDC) closed the session at $34.60 just above calculated resistance at $34.51. The stock effectively broke out and grasped the attention of momentum traders, which could eventually push the stock to a different trading range.

Rowan Companies, Inc. (NYSE:RDC) provides contract drilling services. The Company also owns and operates a manufacturing division that produces equipment for the drilling, mining and timber industries.

The stock was trading in a well defined range with support at $32.49 and resistance at $34.51. Given that this range was broken, traders will be closely monitoring Rowan's price action to gather clues on the future direction.

From a technical perspective, it can be expected that previous resistance becomes support, as the new range gets defined. However, given that Rowan Companies is still near the broken resistance level, traders will be focusing on the $34.51 level to see if the stock holds the breakout without rolling over.