Don’t Trust U.S. Steel’s Rally

Stock's rally is shallow and appears to be a bear flag


United States Steel Corp. (NYSE:X) — This steel manufacturer is one of the largest integrated steel flat-roll producers in Central Europe. It is dependent upon a strong world economy for success, but recent economic reports predict a global slowdown.

We have been bearish on the stock since March when it double-topped at $32. After that, the stock broke down from support at $24.50, and then flashed a death cross signaling that the long-term bear market would continue.

This month, X rallied, but the rally is shallow and appears to be nothing more than a bear flag with support at about $19. The stochastic issued a new sell signal on Friday. The target for X is in the mid-teens. Sell at the market.

Trade of the Day – United States Steel Corp. (NYSE:X)
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Trade of the Day Chart Key

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