U.S. Steel Has Further to Fall

Double-top and heavy selling tell us there’s more downside ahead.

   

U.S. Steel Has Further to Fall

United States Steel Corp. (NYSE:X) — This manufacturer of steel plate, tubular products, etc., is dependent upon a strong world economy for its success. It is one of the largest integrated steel flat-roll producers in Central Europe.

On March 2, with the stock at $27.50, I said, “Technically a channel rally that began in October failed to penetrate its bearish resistance line in February. That failure drove the stock below its 50-day moving average and threatens to break it below the channel’s support line at $27.”

Instead of breaking lower, X rallied to above $30, then reversed and violated its 50-day moving average.

Those who sold or shorted should hold their bearish positions since the double-top and heavy selling are telling us that the stock could fall to the mid-teens.

06 01 12 x 300x190 U.S. Steel Has Further to Fall
Click to Enlarge

chart key U.S. Steel Has Further to Fall


Article printed from InvestorPlace Media, http://investorplace.com/2012/06/trade-of-the-day-united-states-steel-corp-nyse-x/.

©2014 InvestorPlace Media, LLC

Comments are currently unavailable. Please check back soon.