© Copyright 2010-2012, MarketHistory.com
Unauthorized mirroring, photocopying, facsimile or any other
distribution of this copyrighted material is prohibited.
All rights reserved.
Lorillard Inc. - Defense 
Monday, May 24, 2010
By Jay Pasch
Tobacco manufacturer Lorillard (LO3) wilted for a fourth consecutive day on Friday, closing at $74.69 with a marginal decline of -1.0%. With an annual dividend yield of 5.4% and today's bullish study, Lorillard is one stock to consider in this dangerous market.
Q: What is the historical performance for LO after the stock records two consecutive closes below the lower Bollinger band?
A: According to the 21 previous occurrences of this event, EventEdge indicates that LO has shown a somewhat bullish edge that peaks 39 trading days after the event. Thus, the projected date for the peak of the bullish edge relative to the current event date (Friday, 21 May 2010) is Thursday, 15 July 2010. LO rallies in 81% of the cases (17 of 21) by an average of 12.4% relative to the close on the event date. The average of the 4 declines is -3.8%. The overall return of the 21 cases is 9.3%, which, based on the close of LO on the event date ($74.69), provides a target price of $81.64.
To view and modify the event parameters defining this study, click here4 to launch the EventEdge® tool.
Mr. Jay Pasch5 is a private futures and equities trader based in Minnesota. He may hold positions in the instruments mentioned in his trading ideas.
 |
Let variable values:
@ = GII.LO.NYSE
theEvent = IF
1 value ago {
@ is less than bollinger_low ( @, 20 units, 2 ) }
AND
@ is less than bollinger_low ( @, 20 units, 2 )
THEN 1
ENDIF
Date Day t+31 t+36 t+37 t+38 t+39
03/12/2002 Tue 14.2 19.5 18.5 17.2 16.9
06/25/2002 Tue 1.1 1.9 1.7 -1.2 -2.6
07/19/2002 Fri 17.7 11.6 11.2 6.5 5.8
11/13/2002 Wed 12.2 15.2 16.1 19.7 19.3
03/18/2003 Tue 4.0 3.8 8.5 10.0 11.5
08/08/2003 Fri 12.0 8.0 10.8 12.4 12.8
05/04/2004 Tue -3.8 -3.1 -1.7 -4.0 -2.0
07/26/2004 Mon 7.1 7.1 7.0 6.9 4.7
09/21/2004 Tue 18.7 20.7 21.3 21.3 23.4
12/09/2004 Thu 14.1 11.6 11.8 14.3 19.8
05/31/2005 Tue 20.0 25.9 27.1 27.9 29.0
09/23/2005 Fri 13.1 7.7 8.5 8.1 10.9
02/13/2006 Mon 7.5 5.7 5.2 5.4 6.6
07/26/2007 Thu 2.8 4.6 5.6 5.1 5.1
02/12/2008 Tue -5.2 -6.5 -7.5 -7.8 -9.2
03/17/2008 Mon -8.9 -6.5 -6.1 -4.0 1.1
04/10/2008 Thu 0.3 4.6 4.5 6.4 6.0
10/07/2008 Tue -2.5 -3.5 -2.9 -3.6 -1.3
12/17/2008 Wed 11.1 15.6 17.0 16.9 15.6
03/03/2009 Tue 13.3 13.0 12.2 11.5 13.2
03/01/2010 Mon 6.8 9.4 9.0 9.4 8.4
05/21/2010 Fri NaN NaN NaN NaN NaN
Avg 7.4 7.9 8.5 8.5 9.3
AvgPos 10.3 10.9 11.5 12.4 12.4
AvgNeg -5.1 -4.9 -4.5 -4.1 -3.8
PctPos 81.0 81.0 81.0 76.2 81.0
PctNeg 19.0 19.0 19.0 23.8 19.0
Maximum 20.0 25.9 27.1 27.9 29.0
Minimum -8.9 -6.5 -7.5 -7.8 -9.2
StdDev 8.3 8.8 8.8 9.3 9.5
ZStat 0.9 0.9 1.0 0.9 1.0
Variance 68.9 76.6 78.3 86.1 89.6
22 Occurrences |
Comments:
Web Address of this trading idea:
Links:
2 http://www.markethistory.com/content/analog/analog.html?ticker=LO
3 http://quote.morningstar.com/stock/s.aspx?t=LO
4 http://www.markethistory.com/content/events/stocks/chart.html?ticker=LO&events=CloseBelowLowerBoll1,CloseBelowLowerBoll0
5 http://www.markethistory.com/staff/detail.html?s=pasch