Stock to Sell #1 – Allegheny Technologies (ATI)
Allegheny Technologies (ATI), a producer of flat-rolled steel and high-performance metals, has been challenged by weak product demand, low prices and high imports in its flat-rolled steel segment. S&P recently reduced its opinion due to a 7% decline in EBIT and has cut its 2013 earnings forecast by $1.15 to just $1.22.
The stock is trading in a descending triangle with support at $26. The 50-day moving average crossed under the 200-day in April. This is a bearish development called a “death cross,” and it signals a resumption of a bear market in this stock. A close under $26 would confirm that a new leg of a bear market has begun. Sell ATI at the market or on a close under $26 for a plunge to the teens.