International Paper on a Tear

An impressive second-quarter earnings report is propelling International Paper (IP) to a 6% gain to $50.05 this afternoon. This breakout move is attracting heavy trade as shares push into new 52-week-high territory. The sideways consolidation that has been in play since the early March's highs appears to be giving way to a new bull leg. IP is far from overbought and is set up well for more upside.

International Paper (IP) Source: TradeStation View Chart » View in New Window »

After topping in mid-March following a 45% rally off Last November's successful test of the 200-day moving average, IP was in need of a healthy consolidation. Shares moved sideways in a relatively tight range over the next five months. The upper band of the pattern was held by the $49 area while support near $43 prevented various selling waves from doing much damage. Although the damage was slight as IP drifted to a new low last month, the stock reached an oversold reading. Since the June 24 low, which held just above a very supportive 200-day moving average, IP has been in rally mode. Not surprisingly, the $49 area proved very heavy again, halting the rally dead in its tracks. Heading into this morning's report, IP appeared to be leaving behind its third monthly top near $49....124 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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