This laggard could lead in 2014

It's one of the worst stocks in the S&P 500 index –Cliffs Natural Resources. While the market's benchmark is up 27% in 2013, Cliffsis down 37%, making it the second-poorest performer in the entire index.

But could Cliffs do what last year's second-worst S&P500 performer did?

Advanced Micro Devices (AMD) was down 56% in 2012, fairingonly better than Apollo Group's loss of 61%. However, so far in 2013, AMD is up52%. That still means it's one-third lower than where it was at the start of2012, but it's a start.

Talking Numbers contributor Richard Ross, Global TechnicalStrategist at Auerbach Grayson, believes the Cliffs can pull off a similar feat."I love the chart of Cliffs Natural Resources," says Ross.

According to Ross, the 50-week moving average offers atrading strategy he believes works well for this particular name. When thestock moves below the 50-week average, traders should sell; when it moves abovethe 50-week, they should buy, says Ross.

"This has had a remarkable track record of giving yougreat buy and sell signals," says Ross "By 'great' I mean profitable."

Cliffs has just begun broken above its 50-week movingaverage. Along with a reverse headand shoulders pattern, the technicals have made Ross a bull on Cliffs.

"You want to be a buyer here on that breakout,"says Ross. "I think the stock could double and trade at $48."

CNBC contributor Andrew Busch, editor and publisher of The Busch Update, is more pessimistic onCliff's short-term prospects.

"The big 800-lbs gorilla in the room is China,"says Busch. "That's what's driven this company's stock price because itcreates steel and coal and obviously, that's used for a lot of infrastructureprojects."

With China keeping its growth rate down to between 7% and7.5%, demand for Cliffs' output.

"The question is can the global growth picture bereally driven by what's happening in the United States and drive more steeldemand," says Busch. "So far, I'm not sure it's going to drive Cliffsto double in 2014."

To see more of Ross'trading strategy and what Busch thinks is next for Cliffs Natural Resources,watch the video above.

More from Talking Numbers:

DougKass: This could be trouble for Apple
Whatthe Fed's actions mean for housing
Why2014 could be even worse for this retailer

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