Shares of Anheuser-Busch Companies, Inc. (BUD) have been following the trend of the market, losing a 'very large' $5.72 or 9.1% Monday through Friday of last week. The very large five day decline of last week caused the stock to cross below its 13-week lowest low ($54.36) on 'high' volume (20.7 million shares). Anheuser-Busch Companies, Inc. closed at $56.93 on Friday and is currently trading above its 200-day moving average. History shows that when the stock experiences a 'very large' five-day decline while trading above its 200-day moving average in October, a rebound has occurred 18 of 19 times.
Q: How has Anheuser-Busch Companies, Inc. (BUD) performed in the past when it experiences a very large five day decline while trading above its 200-day moving average in October?
A: According to the 19 previous occurrences of this event, EventEdge indicates that BUD has shown a strong bullish edge that peaks six trading days after the event. Thus, the projected date for the peak of the bullish edge relative to the current event date (Friday, Oct. 24, 2008) is Monday, Nov. 3, 2008.
BUD rallies in 95% of the cases (18 of 19) by an average of 3.1% relative to the close on the event date. The average of the one decline is 0.8%. The overall return of the 19 cases is 2.9%, which, based on the close of BUD on the event date ($56.93), provides a target price of $58.58.
To view this idea in EventEdge, click here.
Robert Kolton is an intern analyst at MarketHistory.com.
