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Heavy equipment dealer Toromont Industries reported Wednesday that it earned higher revenue but lower profits in the first quarter.

Seth Perlman/SETH PERLMAN/AP

Toromont Industries Ltd. built a large base from 2008 to 2010 mostly between $11 and $18 (dashed lines). The stock rallied above this trading range in early 2011 to a high of $20.33 (A), pulled back to $15.39 (B), then had a sharp rise to $25, producing an extremely overbought condition (C). This was corrected recently as Toromont pulled back toward its 40-week moving average, providing a good entry point (D). Only a sustained decline below about $20.50 would be negative.

Point & Figure measurements provide targets of $27 and $31. The large base from 2008 to 2010 (dashed lines) supports higher targets.

Monica Rizk is the senior technical analyst for Phases & Cycles Inc. Ron Meisels is a contributor to the www.NA-marketletter.com website. They may hold shares in companies profiled. Please see the site for a glossary.

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Chart source: www.decisionplus.com

Infographic: Bullish on Toromont Industries

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About the Authors
Senior Technical Analyst at Phases & Cycles Inc.

Monica Rizk, Senior Technical Analyst, has a Bachelor's degree in Business Administration and completed the Canadian Securities Institute course. She has been with Phases & Cycles since September 2000 and specializes in the research of Canadian and US stocks using Point & Figure as well as bar chart analysis. More

President of Phases & Cycles Inc.

Ron Meisels, President, Phases & Cycles Inc., has been active as an Analyst since 1971. He was Vice President and Director of Technical Research of Nesbitt Thomson (now BMO Nesbitt Burns) from 1982 to 1990. He was ranked among the top three technical analysts by Canadian Institutions for six consecutive years (Brendan Wood Survey). More

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