Given the recent weakness in the markets, it has become an increasingly difficult task to find a stock that looks like it is positioned to make a move higher. However, one company that has been able to keep above water while others drifted lower is Atwood Oceanics Inc. (NYSE:ATW). As you can see from the chart below, the price was pushed above an influential level of resistance (shown by the horizontal trendline) on June 27. The break above $112.50 suggests that the bulls are in control of the direction and that the stock is a candidate for a move higher. The recent pullback toward the support level could prove to be a strategic entry level for the bulls and the increase in volume will be used as technical confirmation that buyers are gaining confidence in the rally. Bullish traders will likely set their stop losses below the nearby trendline to ensure they are able to get out of a position quickly in case the recent selling pressure continues. To learn more, see The Anatomy Of Trading Breakouts.

We've also added the Parabolic SAR indicator, which is a common indicator used by traders to determine strategic levels for the placement of stop-loss orders. A sell value is triggered when the price moves below the SAR, which is shown on the chart by the reversal of the dot placement from below the price to above it. A buy signal is generated when the price rises above the SAR reading. Many traders will place their stop-loss orders near the SAR value because a break beyond this level often signals a short-term shift in the stock's direction.

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