Rowan Companies Close to Probable Support

Published on Monday, 30 August 2010 06:16 Written by Christian Paolinetti

New York, August 30th (TradersHuddle.com) - Shares of Rowan Companies, Inc. (NYSE:RDC) closed the trading session at $25.60 near its 50 day and 200 day moving averages currently set at $24.96 and $25.54 respectively. Rowan's price action is above these important levels, which could translate into a trading opportunity.

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.

Although the price action is above important moving averages, it's important to highlight that the 50 day moving average is currently below the 200 day moving average resulting in not a prime setup where buying the dip will present a good trading opportunity.

Looking at peaks and troughs horizontal support and resistance levels, we can see current calculated support at $24.86 and calculated resistance at $27.11. These levels should also be evaluated by traders when planning their trades, as they provide an insight into the latest price action.

If traders want to establish a position on Rowan Companies, should evaluate their trade, as it will certainly be better to wait, given that the stock is technically broken with the 50 day moving average trading below the 200 day moving average. Traders can also look at the current range defined by the peaks and troughs see where the current price action of stock is and establish a short trade versus those levels.