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Today we've chosen to take a look at Stanley Works (NYSE:SWK) because we've identified a well-formed head-and-shoulders pattern. As you many of you know, this chart pattern is used by technical traders to suggest that the uptrend is setting up for a reversal. Notice how the level of support near $53, also known as a neckline, has propped up the price of the stock in the past. Traders will watch for a move below this support to be combined with an increase in volume to signal a sharp move toward our target of $46.25.

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