Industrials are retreating across multiple fronts, and the rattling in the broader equity markets aren’t making matters any easier. In fact, the Dow Jones Industrial Average is down 424.66 points, or 2.3%, in the past five days alone.
For investors seeking downside action, or to simply stay away from weakness in the marketplace, Profit Scanner powered by Recognia has narrowed the field and identified three plays that are squarely in bears’ crosshairs.
These stocks have been flagged for several bearish technical signals, meaning the downtrend action could serve up mouthwatering gains for the shorts.
Without further ado, let’s dive right in.
Industrial Stocks to Sell: Cleantech (CLNT)
As you can see in the adjacent chart, Cleantech’s situation is transitioning from worrisome to downright ugly. Some investors love to scoop up shares on the cheap, hoping for a rumor or news event to propel shares higher. Cleantech’s luck, however, is running out.
On Sept. 12, Profit Scanner discovered a bearish pattern, known as a descending continuation triangle, on a day CLNT closed at $1.03 per share. The pattern is confirmed when the price breaks out of the triangle formation to close below the lower trendline.
With a target price range of 10 cents to 30 cents, investors should exercise caution when considering a position in a stock that could lose much of its remaining value in the months to come.
Industrial Stocks to Sell: Crane Co. (CR)
Click to Enlarge Crane Co. (NYSE:CR) is in the business of manufacturing and selling engineered industrial products, both domestically and abroad, in segments as diverse as payment and merchandising to aerospace and electronics.
In the intermediate-term price chart of CR stock, we see a dome-shaped formation (known as a “rounded top”). This technical event is often referred to as an “inverted bowl” or a “saucer top.”
Whatever you decide to call it, it’s a bearish signal indicating a possible reversal of its current uptrend. The bearish pattern is confirmed when the CR stock price breaks below its moving average.
The technical pattern was flagged by Profit Scanner on Sept. 12, back when CR closed at $62.31. If the gap just below the current price fills, investors could pocket quick gains betting with the bears.
Furthermore, the conservative target calls for price to reach $59.70, which would result in a 4.2% gain to the downside. While the gains may be marginal, it’s often difficult to pass up a potential trend-changer in anticipation of a price gap fill to come.
Industrial Stocks to Sell: Manitex (MNTX)
Click to Enlarge Manitex International Inc (NASDAQ:MNTX) provides engineering machinery that includes cranes, forklifts, container handling equipment, etc. The company serves a wide range of clients (government, military and commercial) through a dealer network.
In the adjacent chart, we see that MNTX stock just can’t seem to shake off its longer-term downtrend. Every time Profit Scanner has confirmed a bearish technical event, shares of MNTX continue to drift lower.
On Sept. 7, the MNTX stock price sliced definitively through the 200-day MA, followed by a bearish crossing of the 50-day moving average on Sept. 9. Then, just three days later on Sept. 12, Profit Scanner issued another bearish event as MNTX broke down and out of a “symmetrical continuation triangle.”
This pattern is considered a bearish signal, indicating that the current downtrend may continue. It shows two converging trendlines: the lower ascending, the upper descending. The formation occurs when prices reach both lower highs and higher lows. The pattern displays two highs touching the upper (descending) trendline, and two lows touching the lower (ascending) trendline. This pattern is confirmed when MNTX breaks out of the triangle formation, closing below the lower (ascending) trendline.
You might be thinking, “where do we go from here?” Well, Profit Scanner now expects MNTX prices to slice through early 2016 lows. On Sept. 12, a price target of $2 to $2.70 was given (range shown in dark red). Given the $5.73 price close at the time of the event, investors who acted could see gains of up to 52.9% on the conservative end. And, should the most ambitious target level be achieved, could see gains of 65.1%.
Profit Scanner powered by Recognia can help traders of all levels uncover these signals to determine the best timing to buy. Or use Profit Scanner’s technical insight to validate your own trading ideas. See how easy this powerful tool is to help you uncover hidden opportunities in the market.