Technical Picture: Bidu (307.75) suggests a classic "Head & Shoulders" technical pattern

Technical Scenario: Baidu (BIDU) is exhibiting a classic head & shoulders technical pattern and appears ready to either bounce from the 300 level creating a right shoulder or a potential lower breakdown at these price levels. Currently, the stock has maintained a few inside days of quiet action which often precedes future breakout moves in either direction.

Fundamentally, Baidu's projected 2007 earning growth is expected to reach +105% (per Zacks estimates) with 4th Qtr. average estimates of .74/share and 2007 year-end projections of $2.30/share, +63% and +105% growth, respectively. This next quarter, however, has been revised downward by .01/share while fiscal year 2007 EPS has been revised upward from $2.19 to $2.30 EPS.

This is often a time when investing styles conflict. Technical vs. fundamental with the technician arguing a downturn placing much expectation on the $300 H&S support line. Fundamentalists are still maintaining a bullish outlook considering the optimistic year-end estimates.