Foster Wheeler (FWLT) Chart – May 29, 2009

I charted Foster Wheeler AG (FWLT) on Friday, May 29, 2009 before 2:00 pm when it was trading at $26.54.  FWLT is considered a midcap growth company and is in the Industrial Goods sector.

• FWLT has been running in a very stable trading channel for more than a couple of months
• This morning FWLT breached the top side of that trading channel’s trend line of higher highs
• FWLT crossed above its 200 day simple moving average (sma) two days ago (not shown) and then came back below before coming back to close above it yesterday – through 2pm today FWLT has stayed above that line
• FWLT remains well above its 50 day moving average and has used its 10 and 20 sma as support multiple times
• Williams %R still remains overbought where it could stay during this bull run for weeks to come, falling below that will be the red flag

Opinion:  Since this trading channel has been so strong for so long I’m not going to fight it and buy in at these prices.  That said, it did nudge up above the trend line this morning before faltering.  It’s going to be an interesting one to watch.  Monday could bring a gap up above that trend line which could offer another good run or it could resume its move back towards the lower trend lines of higher lows.  Either path could create a good buying opportunity.