Safe Bulkers, Inc. (NYSE: SB)

Safe Bulkers, Inc., a marine drybulk transportation services company, engages in the acquisition, ownership, and operation of dry bulk vessels worldwide. The company transports various bulk cargoes, primarily coal, grain, and iron ore. As of March 14, 2013, it had a fleet of 25 dry bulk vessels. Safe Bulkers, Inc. was incorporated in 2007 and is based in Athens, Greece.

To review Safe’s stock, please take a look at the 1-year chart of SB (Safe Bulkers, Inc.) below with my added notations:

1-year chart of SB (Safe Bulkers, Inc.)

Over the last 3 months SB had created a strong level of resistance at $11 (green), which also constituted a 52-week high resistance. A breakthrough that level would most likely mean higher prices for the stock. As you can see from the chart, SB finally broke higher last week and should be hitting new highs moving forward. The increase in volume on the break (blue) should add “validity” to the breakout.

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The Tale of the Tape: SB broke out to a new 52-week high. A long trade could be made near $11 with a stop placed below that level. A break back below $11 would negate the forecast for a continued move higher.

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Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.

No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!

Good luck!

Christian Tharp, CMT

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