“With unemployment at 9.6% across the United States, it doesn’t seem likely an employment agency would be a hot stock. But staffing firm Kelly Services, Inc. (KELYA 17.86 Nasdaq) appears to be a rising star. That’s because as the labor market slowly improves, companies need more employees to meet growth demands—without having to hire permanent staff. So, many companies are turning to Kelly’s temporary staffing services to hire contract employees. ...
“Technically, the stock looks strong. KELYA is above its upper Bollinger band and rising toward $18.93 resistance. This level marks the stock’s two-year high, hit in late April 2010. After reaching this peak, the stock fell sharply, before finding support at $10.07 in late August, 2010. The lower Bollinger band currently intersects at this level. Rising strongly off its August low, an intermediate uptrend formed. KELYA is currently well above this uptrend line and trending higher. In October the stock broke resistance near $13.84, the current intersection of the 20-week moving average, marked by the middle Bollinger band. Soon after, KELYA surged above the 30-week moving average. Just recently, the rising 10- week moving average bullishly crossed above the 30- week moving average. If $18.93 resistance was to be exceeded, the stock could test its 2008 high of $22.61 or perhaps even move toward its 2007 peak of $32.31. ... I plan to go long on the hiring agency. However, I will wait until the stock breaks technical resistance at $18.93. ... My target is $32.31, the stock’s 2007 high.”
Dr. Melvin Pasternak, Double-Digit Trading, 11/21/10
