The South Financial Group Inc.
(Public, NASDAQ:TSFG)
Bottom plays have become a specialty of ours, especially after our latest alert on Clean Coal Technologies (PINK: CCTC) which had major success bringing in more than 300% return on investment for our readers, thus we are launching our new candidate in The South Financial Group Inc. (NASDAQ: TSFG). This company is our next target for a turnaround rebound play based on strong upward-moving technicals. The past few months the company has been riddled by dilution and negative sentiment, thus the price per share has been sliced and diced to mere pennies, representing what is now the perfect buying opportunity for those looking to make some nice quick short-term gains. There is a definite possibility the stock will be headed towards the $0.57 resistance level, where it will once again retest the 50 day moving average within the next couple of days. The company is also listing a high number of job openings on their website (seen here and here), which usually signals a positive forward going outlook from management. On Friday, TFSG also received additional praise, as it was recognized as a national and regional winner of 2009 Excellence in Small Business Banking awards from Greenwich Associates. Price target has been set for $0.57 in the short-term, with a highly confident sentiment. Moreover, the company has also received a NASDAQ delisting requirement of maintaining the $1.00 target price per share for a two week period, thus, you can expect the company will do everything in its power to achieve it. The stock also has roughly 10M shares short, thus a squeeze on news or a bullish run up could certainly propel the stock higher.
About The South Financial Group Inc.
The South Financial Group (NASDAQ: TSFG) is a bank holding company dedicated to serving small businesses, middle market companies, and retail customers in the Carolinas and Florida.
Founded in 1986, TSFG’s fundamental focus is to establish strong relationships with its customers by providing a broad range of financial products, solutions, and services and by helping customers achieve financial success. TSFG provides commercial, retail, and private banking, as well as insurance and investment services, with an emphasis on personalized services, local decision-making, and community involvement.
Headquartered in Greenville, South Carolina, TSFG operates Carolina First Bank which conducts operations as:
> Operates in North Carolina and South Carolina
> 110 banking offices (12/31/09)
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> Operates in Florida
> 67 banking offices (12/31/09)
> A division of Carolina First Bank
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> Operates on the Internet
> A division of Carolina First Bank
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Technical Chart Analysis
Since August of 2009, the stock has been in a constant down-trend (as indicated by the long black line) with a massive sell off that never seemed to end, that is, up until now. Stochastics have been so beaten down the last couple of months that the only possible route for them to head is up, after all, what goes down must eventually head back up. Taking a look at the chart, we’ll start with the clear basics. The Relative Strength Index (RSI) indicated by the blue circle, is currently representing a highly oversold position for the stock, thus a textbook rebound back above the 50 line is imminent. The volume bars have also shaped up as green buying pressure the last couple of days, representing the bulls are beginning to take hold of the momentum. Full Stochastics remains highly undervalued and a rebound to the 80 zone should be seen once again within the next couple of days as more investors take notice of this rare highly undervalued buying opportunity which doesn’t present itself all too often. There is resistance at $0.44 (20 days moving average) which is currently being tested, and should be broken fairly easily thus establishing the new support and allowing the stock to move onwards towards the $0.57 (50 days moving average). A really bullish sign was the fact that the stock had a clear white candle on lower than average volume thus seeing an 11.23% increase in price, thus setting up another larger potential gain on larger volume should it arrive in the coming days. The MACD divergence is also turning positive (as seen by the red square), with the crossing over further indicating that a bullish run is about to take place.
The Money Flow Index (MFI) is a technical indicator used by chart analysts to see whether money is flowing in or out of a stock. Generally, if a stock is above the 80 critical point, it is perceived as being too overbought thus you should be cautious when proceeding to buy as it could turn and head back down once profit taking ensues. The perfect buying opportunity happens once a high number of these profit takers arrived, and such is indicated by the MFI indicator being near the 20 level and heading upwards, showing buyers are beginning to put pressure on sellers. The South Financial Group is perfectly positioned to make gains based on the MFI.
Look for The South Financial to really make a move higher in the next couple of days as stock scanners begin to pick up bullish technical alerts.
Disclosure: Long TSFG
TheMarketFinancial is not paid, compensated or in any way incentivized to report news and developments about publicly traded companies, unless otherwise stated.
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About Michael: A young and savvy, yet experienced and accomplished investments mogul since ‘01; Michael has amassed a fortune as a private self investor. Recently starting his own successful blog and turning it in to a corporation — MIV Investments Inc., a company offering advice to thousands of people worldwide and attracting contracts from various reputable sources. His articles and publications have been linked to Forbes, CNN Money, Reuters, Bloomberg, and many other top worldwide mainstream media sources. |
