Nuts and Bolts Trading in Illinois Tool Works
- Posted by Greg Harmon
- on October 31st, 2012
Illinois Tool Works, $ITW, has been beaten up lately in some press stories, for some insider selling. Who knows why insiders sell. To pay their kids tuition, buy a new house, pay their tax bill. News may or may not be discounted already so it is a whole lot easier to just look at the price action to see if this stock is a buy. From the daily chart below you can easily see that it has been consolidating in the blue box between 58 and 61.50 since it moved above the resistance level at 57.50 that extends back to July 2011. A healthy consolidation after making new highs. But there
Illinois Tool Works, $ITW
are several signs that it may be ready to move higher after 2 and a half months in that box. First the 50 day Simple Moving Average (SMA) is giving it a lift. Next the Relative Strength Index (RSI) is making a new higher high. Third the Moving Average Convergence Divergence indicator (MACD) is positive for the first time since late August, moving there from negative 2 weeks ago. all it needs now is a trigger, a move over 61.65, to signal a buy. From there it ha a Measured Move higher to 73.60. it will not move there in a straight line, but the 2.5% dividend yield should compensate you adequately to give it some time.
Join the Dragonfly Capital Views Premium Membership
Sign up here to get deeper analysis and nearly 50 trade ideas every week.
I noticed an error on my website that continued to offer the Annual membership at $600, but if you clicked through you saw a price of $750. This is in the process of being corrected. If you clicked through thinking you were going to pay $600 and then stopped because of the higher price send me an e-mail at [email protected] and I will honor the lower rate.
If you like what you see above sign up for deeper analysis and trading strategy by using the Get Premium button above. As always you can see details of individual charts and more on my StockTwits page.
The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.blog comments powered by Disqus
Gregory W. Harmon CMT, CFA, has traded in the Securities markets since 1986. He has held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)
Dragonfly Capital Updates
- Macro Week in Review/Preview December 6, 2013
- With The US Market in the Dumps Turn To China (Part III)
- Testing the Waters With Celgene
- A Long Term View On…. The Redux of 2013
- Premium Earnings 12-5-13
- 4 Lessons From A Glance Back at 2013
- The PC is Dead, Long Live PC Stocks
- Premium Earnings 12-4-13
- With The US Market in the Dumps Turn To China (Part II)
- With The US Market in the Dumps Turn To China (Part I)