After hitting our market psychology barometer reading of 31 on 2008-02-21, it’s fourth lowest since 1991, Sara Lee is a buy. Here’s why.
The chart below shows these four dates marked A, B, C and D. All showed recent steep declines.
After these declines, prices rebounded 30%, 77% and 41% respectively within one year. If history is to repeat itself, I expect Sara Lee to have a similar rebound.
The upside target is $17 while the stop-loss figure is $12. The current closing price is $13.13.
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$13.11 (02/25/08)
