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Even though I prefer fundamental analysis when looking at stocks to buy, I also think it is important to look at the technical side as well. After doing fundamental analysis, I want to see how a stock looks based on the charts, including what the 50 and 200 day moving averages are, and what the relative strength index is before deciding to buy. When evaluating this data, you can find stocks that appear to be starting what might be a significant new uptrend. One potential sign of this is when the 50 day moving average crosses above the 200 day moving average. This event is called a "Golden Cross Formation" and many view it as a bullish sign. You can read more about the Golden Cross Formation here. To learn more about technical analysis in general read this. It is wise for investors to be aware of how a stock looks in terms of the charts, as this can give you an edge over using just fundamental analysis.
These shares have reasonable valuations, and (most have) strong balance sheets. The fact that the charts might be indicating a new uptrend is an added bonus. Here are the companies, which all have a "Golden Cross Formation" recently appearing on their chart. Some might just be good for a trade, while others might be interesting longer-term plays. To view the charts for any of these stocks visit stockcharts.com.
ITT Educational Services (NYSE:ESI) shares are trading at $72.44. ESI is based in Indiana, and provides educational and training services. These shares have a 52 week range of $50 and $121.98. The 50 day moving average is $70.30 and the 200 day moving average is $67.68.

Fundamentals: Estimates for ESI are about $9.52 per share in 2011, and $8.01 for 2012. The private education sector has been hit hard and has been volatile for the past few months. There are concerns about new government regulations which could lead to reduced enrollments. These concerns might be priced in as the PE ratios are well below the market average. Other stocks in this sector (see below) APOL, and LINC are also looking like they might trend higher, which might be another sign this sector has seen the lows.

Apollo Group (NASDAQ:APOL) is trading at $42.30. APOL is based in Arizona, and provides educational and training services. These shares have a 52 week range of $33.75 and $66.69. The 50 day moving average is $42.77 and the 200 day moving average is $42.31, so the shares are trading close to support levels and barely have made the Golden Cross Formation. Because of that, this needs to show more strength before looking like a uptrend is confirmed.

Fundamentals: Estimates for APOL are at $4.61 per share in 2011, and $4.27 for 2012. Book value is stated at $8.23. According to Yahoo Finance, APOL has about $1.04 billion in cash and about $186 million in debt, so the balance sheet looks very strong. The private education sector has been hit hard over concerns about new government regulations, which could lead to reduced enrollments. These concerns might be priced in as the PE ratio is well below the market average. It is interesting to see a couple of stocks in this sector looking better technically.

AsiaInfo-Linkage (NASDAQ:ASIA) is trading at $22. ASIA is based in China, and provides security software and other computer services. These shares have a 52 week range of $15.76 and $32.60. The 50 day moving average is $20.24 and the 200 day moving average is $20.05, so these shares are trading about 10% above support levels.

Fundamentals
: Estimates for ASIA are about $1.59 per share in 2011, and $1.76 for 2012. These shares are trading well below their 52 week highs, although the have spiked recently, so it would make sense to wait for a pullback if you wanted to buy these shares. The company recently announced a stock repurchase plan of up to $60 million, which you can read about here.

Artio Global Investors (NYSE:ART) is trading around $16. ART is based in New York, and provides asset management services. These shares have a 52 week range of $12.82 and $26.22. The 50 day moving average is $15.40 and the 200 day moving average is $15.23.
Fundamentals: Estimates for ART are at $1.60 in 2011, and $1.65 per share in 2012. Book value is stated at $1.78. ART pays a dividend of 24 cents, which is equivalent to a yield of 1.5%. Apparently, Whitney Tilson (a well known investor and founder of T2 Partners) likes ART and has been buying. You can read more about this here.
Lincoln Educational Services (NASDAQ:LINC) is trading at $16. LINC is based in New Jersey and provides educational and training services. These shares have a 52 week range of $9.73 and $28.21. The 50 day moving average is $15.43 and the 200 day moving average is $15.08, so the shares are trading close to support levels.
Fundamentals: Estimates for LINC are at $1.86 per share in 2011 and $1.86 for 2012. Book value is stated at $10.02. The private education sector has been hit hard over concerns about new government regulations, which could lead to reduced enrollments. These concerns might be priced in as the PE ratio is well below the market average. It is interesting to see APOL, ESI and this stock, which are all in the same sector, looking better technically.

Banco Bilbao Vizcaya (NYSE:BBVA) is trading at $12.20. BBVA is a major bank and is based in Spain. These shares have a 52 week range of $8.65 and $15.40. The 50 day moving average is $12.04 and the 200 day moving average is $11.75, so the shares are trading close to support levels. While a confirmed uptrend is not in place yet, this might be the early signs of more gains. With all the bad news about Spain, it's interesting to see this bank showing some strength.
Fundamentals: Estimates for BBVA are at $1.56 per share in 2011 and $1.39 for 2012. Book value is stated at $11.34. The headlines about Spain, Portugal and other countries have been very negative lately, over concerns of sovereign debt defaults and the Euro as a currency. Another Spanish bank, Banco Santander (STD) is also showing some strength (see below).

Banco Santander (STD) is trading at $11.94. STD is a major bank and is based in Spain. These shares have a 52 week range of $8.65 and $14.80. The 50 day moving average is $11.99 and the 200 day moving average is $11.75, so the shares are trading close to support levels. It's too early to call this a solid uptrend but it's worth watching. As with BBVA above, it's interesting to see this bank showing some strength.
Fundamentals: Estimates for STD are at $1.56 per share in 2011 and $1.39 for 2012. Book value is stated at $11.87. The headlines about Spain, Portugal and other countries have been very negative lately over concerns of sovereign debt defaults and the euro as a currency. These banks are worth watching though.

The data is sourced from Yahoo Finance and Stockcharts.com. The information and data is believed to be accurate, but no guarantees or representations are made. Rougemont is not a registered investment advisor and does not provide specific investment advice. The information contained herein is for informational purposes.



Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: 7 Stocks With a New Golden Cross Signal