This Chemicals Stock Appears Headed for a Meltdown

by Sam Collins | February 26, 2013 1:55 am

This Chemicals Stock Appears Headed for a Meltdown

Celanese Corp. (NYSE:CE[1]) — This company produces industrial chemicals, engineered plastics and acetate fibers. Because of its international nature, it could be highly sensitive to a global recession. According to S&P, the company could be hurt by higher-than-expected raw material costs in Europe, and a decline in demand for acetyls, thanks to the government’s austerity measures.

The stock rallied along with the market, but has formed a bearish horn, and on Monday, reversed down through the support line at $46 and its 50-day moving average at $46.59. MACD is flashing a sell signal.

Investors should sell CE if they own it, while traders can sell short with a price objective of $40. Short selling is a speculative technique that is not suitable for many investors. Short sellers should use stop-loss orders to protect against unlimited losses. Also, check with your broker for any unusual margin requirements and the ability to borrow the stock.

02 26 13 ce 300x202 This Chemicals Stock Appears Headed for a Meltdown
Click to Enlarge

chart key 300x84 This Chemicals Stock Appears Headed for a Meltdown

Endnotes:
  1. CE: http://studio-5.financialcontent.com/investplace/quote?Symbol=CE

Source URL: http://investorplace.com/2013/02/trade-of-the-day-celanese-corp-nyse-ce-4/
Short URL: http://invstplc.com/1fwu3Xr