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PRIME STOCK NEWSLETTER FOR DECEMBER 8th, 2009

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Position Statement: In our Prime Recommendation Letter we attempt to identify the recommendation with the highest probability of moving higher.  We recommend that stop orders be placed at the time of purchase,  and once the position has moved profitable we recommend a stop be placed a minimum of $0.375 above the purchase price and moved higher as the position moves higher.

Today's Comments: The overall market finished Monday essentially unchanged with the Dow Jones Industrial Average finishing up slightly while the S&P 500 and NASDAQ Composite were both lower. A majority of the various sector indices were lower on the day with the weakest sectors being the Banking, Gold/Silver, Broker/Dealer, Transports, Insurance, Pharmaceuticals, Commodities, Consumer, Cyclicals, Healthcare Providers, and Retailers. There was strength in the Telecom, Utilities, Chemicals, and Biotech. The High Tech indices were mixed. Oil was down by $1.54 to $73.93/barrel, and Gold was lower by $4.10 to $1,158.30 per ounce.

In my nightly review of the charts from yesterday's trading activity I noticed while there were still a fair number of stocks that appear to be moving higher, a majority of them appear to be showing weakness.


Sterling Calendars for the Week of December 8th, 2009
Economic Calendar
Date Est. Time Release

For

Consensus Prior
12/09 10:00am Wholesale Inventories Oct. (0.5%) (0.9%)
12/09 10:30am Crude Inventories 12/04   2.09M
12/10 8:30am Initial Claims 12/05 465K 457K
12/10 8:30am Continuing Claims 12/04 5,435K 5,465K
12/10 8:30am Trade Balance Oct. ($37.0B) ($36.5B)
12/10 2:00pm Treasury Budget Nov. ($134.1B) ($176.4B)
12/11 8:30am Export Prices Ex-Ag. Nov. N/A 0.3%
12/11 8:30am Import Prices Ex-Oil Nov. N/A 0.4%
12/11 8:30am Retail Sales Nov. 0.7% 1.4%
12/11 8:30am Retail Sales Ex-Auto Nov. 0.4% 0.2%
12/11 9:55am Michigan Sentiment Dec. 68.5 67.4
12/11 10:00am Business Inventories Oct. (0.3%) (0.4%)

Recommendation: Sell/Short

Murphy Oil Corp. 'MUR'

Company: Murphy Oil Corp. Symbol: 'MUR' Closing Price: $54.81

Web: www.murphyoilcorp.com

YH: $65.12 YL: $37.96 EPS: $3.36 P/E: 16

Shares Outstanding: 191 Million

Forecasted EPS: $5.01 Market Cap.: $10.5 Billion
Dividend: $1.00 Yield: 1.80% Aver. Daily Trading Volume: 1.70 Million Shares  
Price Targets:  $52.39, $50.38 and then $46.02 Upside Stop:  $55.97/share
Options Rec.: December 55 Puts@ $1.45/contract Options Symbol: MUR X55

Additional information on Murphy Oil Corp. 'MUR' can be found (here)

Company Description: Murphy Oil Corporation operates as an oil and gas exploration and production company in the United States, Canada, the United Kingdom, Malaysia, Ecuador, and internationally. It operates in two segments, Exploration and Production, and Refining and Marketing. The Exploration and Production segment explores for and produces crude oil, natural gas, natural gas liquids, condensate, and synthetic oil. It has an interest in a Canadian synthetic oil operation, owns two petroleum refineries in the United States, and one refinery in the United Kingdom. The Refining and Marketing segment refines crude oil and other feedstocks into petroleum products, such as gasoline and distillates; buys and sells crude oil and refined products; and transports and markets petroleum products. The company was formerly known as Murphy Corporation and changed its name to Murphy Oil Corporation in 1964. Murphy Oil Corporation was founded in 1950 and is based El Dorado, Arkansas..

Chart for Mosaic Company

Chart updates daily

Recent News:
12/04 U.S. Oil Production Increases - A Blip Or A New Trend? at Investopedia (Mon, Nov 23)
  11/10 Murphy to restart two Gulf platforms after Ida at Reuters (Tue, Nov 10)
  11/05 Murphy Oil Corporation Q3 2009 Earnings Call Transcript at Seeking Alpha (Thu, Nov 5)
A full list of the news headlines for the Murphy Oil Corp. 'MUR' can be found (here)

Our Analysis: The shares of Murphy Oil Corp. 'MUR' have been trending lower since early October of this year. Yesterday the shares of 'MUR' closed below a recently established downside support level on heavy trading volume. This is a bearish trading signal. The shares of 'MUR' should continue to move lower and test $52.39/share, the point from which they gapped higher on the open of trading on July 15th of this year. If the shares of 'MUR' close below that level as I expect they will, then they should continue to move lower and test $50.38/share, a point of downside support established on July 8th of this year. Our slightly longer term target is $46.002/share, the point from which they gapped higher on the open of trading on April 29th of this year. I see downside support on the shares of 'MUR' @ $55.57/share, and have set my stops accordingly at $55.97/share.


Stocks Looking Higher
RMBS, IMAX, CYBX, PEP, DTV, BRCM, OSIS, BA, GWR, CRUS, CI, HON, WRLD, PKG, RCI, CPV, TU, T, DAL, WMT, YGE, MHP, CBS
Stocks Looking Lower
PFE, WFC, AAPL, WFT, XOM FCX, AMTD, SU, APC, LEN, CLF, APA, ORI, MUR

Yesterday's Edition of the Prime Stock Newsletter
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