LNN Specifics

Attatched you will find a chart of Lindsay Corp which trades on the NYSE under the ticker Symbol LNN. Lindsey manufactures self propelled irrigation systems for the global agriculture industry. This is a group that, obviously, as world populations continue to grow, and the ranks of the middle class explode, is a very in depend group and area. When I look for a stock to buy or sell I always start off with a chart. For the first six and a half years of my trading career I was a 100% technical trader, and while I now incorperate a lot of fundamental analysis (Anthony) into what I do, T/A remains by far my strongest skill. Each evening I will download TC2000 data onto my computer and scan through the 2000/2500 most actively traded issues of the day. This gives me a good broad look at the market, something you wont get looking at only a few setup based scanned patterns, or even by looking at the indexes themselves. What I'm always looking for is relative strength in an upmarket and relative weakness in a down market. Once I have isolated that I start watching for patterns to show up that give me clues about what a stock might be doing. We can see here on LNN that on March 19th it had a HUGE up gap. That gap was not filled, which is very important. Most gaps try to fill in, those that do not often represent the very strongest names in the market. A few days after its large gap LNN did what most stocks will do in this type of situation and it rested. Stocks can rest in a variety of ways, they can trade sideways, or slightly down (such as LNN did) forming a flag. This high level and very tight flag that LNN formed is one of the very strongest patterns you are likely to see. After I look at the chart I want to have a basic look at the fundamentals. In this case I see that LNN is part of an industry that is having a global expansion due to fundamental shifts in world population trends that are likely to continue. The stock has had solid earnings and revenue growth going back the last three quarters. The most recent qtr saw EPS increase by 276%, which is well above the 25% I like to see. Not only is EPS growing nicely but this is a company with very little debt, decent cashflow and a respectable 12% return on Equity. So, when I combine these things with the technical I have a picture I like IF the stock confirms my opinion is a valid one. For me the only way for a stock to prove its validity is to trigger an entry. In the case of LNN I had my buy order placed above 103.50 and had an average entry of 104.11. In more "ordinary" market conditions I'd be inclined to give a stock like this a lot of room to move around once I got in, but in the case of LNN that was not the case. My first concern came about on the very day I bought the stock in that volume was not all that heavy. Yesterday the stock started off very strong, but pretty quickly turned to the downside and triggered my trialing stop loss around 109.50.