Shares of global security and aerospace company Lockheed Martin (NYSE:LMT) gyrated wildly on Tuesday following its latest earnings report. LMT stock did, however, manage to shake off the sellers by day’s end, and that now sets the stock up with a well-defined price level above which it can be bought for a trade.
In its latest quarter, Lockheed Martin beat analysts’ top- and bottom-line expectations. More importantly, however, the company also raised both its EPS and sales forward guidance. Sales guidance was raised to $51.6 billion to $53.1 billion from a previous range of $50.35 billion to $51.85 billion.
Before looking at the charts, allow me to say that at this point in the business cycle I am cautious on industrial stocks as a sector. However, this does not mean that I cannot take trades.
LMT Stock Charts
Moving averages legend: red – 200 week, blue – 100 week, yellow – 50 week
On the multiyear weekly chart, we see that LMT stock continues to hold on to its longer-term support line (blue arrow), which it mean-reverted back to and bounced from in June. Along with the broader stock market, this stock overshot above its longer-standing up-trend coming into January/February of this year. It then stopped going higher and, over the next five or so months, corrected 20%, right back to the aforementioned support line. Note that this simple trend line also matches up with the blue 100-week simple moving average for some well-defined confluence support.
In late June, the stock then began to rally right into this week’s earnings report. Note that the stock now resides at the yellow 50-week moving average …which gets us to the daily chart.
Moving averages legend: red – 200 day, blue – 100 day, yellow – 50 day
On the daily chart, we see that this current juncture around the $325-$330 area also lines up with horizontal resistance (blue horizontal bar) as well as with the 100- and 200-day simple moving averages.
Considering that the stock continues to hold its longer-term up trends I want to use this price confluence resistance area as a level to respect and buy LMT stock if and when it pushes above there.
Specifically I want to buy LMT stock upon a weekly close above $327, using a first upside target at $340 and any strong daily bearish reversal as a stop loss.
Trading is not easy but certainly not impossible. Today I am holding a special webinar for InvestorPlace readers where I will explain and show a large trading loss of mine … and share the crucial lessons I learned from this. Register HERE.
Access Serge’s Free SSO Strategy eBook HERE — find high-probability trades like a Wall Street professional.
The Ultimate Marijuana Stock to Go Ballistic in the Next 90 Days
While we’re on the subject of investments that can help you build great wealth …
It’s very important that you know recreational marijuana is set to become legal in Canada this fall. The result will send selected Canadian marijuana stocks soaring.
If you act quickly, before most Americans catch on, you, too, could turn every $10,000 you invest into $30,000, $40,000, $50,000, or more.
Here’s the full story and how you can get in on the ground floor.
