Linear Technology Breaks Out

An upgrade from Jefferies has sparked a powerful surge in shares of Linear Technology (LLTC). Analysts there lifted the electronics maker to Buy from Hold and raised the price target to $44 from $38. Investors jumped on the news, sparking a huge gap-higher open that lifted the stock to fresh 52-week highs. After a brief dip in the early going, LLTC returned to rally mode and set a new one-year peak of $39.61 after taking out the March 2013 high of $38.90. Volume is not overwhelming by any means, but showing a nice uptick over the positive action earlier this week.

Linear Technology (LLTC) Source: TradeStation View Chart » View in New Window »

The news-inspired ramp ends a rather volatile consolidation pattern that began to form after the late February peak. LLTC began to pull back in March and by early April was under very heavy pressure. Shares dipped all the way down to the 200-day moving average retracing the entire 2013 rally in the process. LLTC rebounded sharply off the April 19 lows as the consolidation continued. This choppy action narrowed in May and June while volume contracted. After 16-plus weeks of sideways trade, the stage was set for a new bull leg. Today's action likely begins a fresh rally that could push LLTC considerably higher....95 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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