Stock to Sell #6 – United States Steel Corp. (X)
United States Steel Corp. (NYSE:X) is a manufacturer of steel plate, tubular products, etc., and is dependent upon a strong world economy for success. It is one of the largest integrated steel flat roll producers in centralEurope. In addition to a weak European economy, recent increases in energy costs are a detriment to profitability. The company has had negative earnings for the past three years.
Technically a channel rally that began in October failed in February to penetrate its bearish resistance line. That failure drove the stock below its 50-day moving average and threatens to break it below the channel’s support line at $27. The MACD indicator is negative. Shareholders should either sell the stock or write calls or buy puts to protect against a possible new leg down.