Trendline Holding Strong on this Construction Equipment Giant

Tuesday, we took a look at the setup in Shutterstock (SSTK) and started watching for a buy signal.

Today, we’re going to look at Caterpillar, Inc. (CAT).

From its website:

Caterpillar is the world’s leading manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives. We are a leader and proudly have the largest global presence in the industries we serve.

CAT has been in a steady uptrend for the past few months, and has held support numerous times when tested. This is a sign of a strong trend being in place.

Let’s take a look at the daily chart below:

chart

CAT has held its current up-trendline four times I’ve previously said in regard to trendlines, a minimum of three tests is required in order for a trendline to be considered valid. The more tests, the stronger the trendline.

The solid trendline and the strong uptrend puts us on watch for a PowerTrend buy signal starting now.

See ya tomorrow!

Trade Smart,

Michael Saul
Analyst, Chart of the Day

Michael Saul

Written By Michael Saul

Michael Saul has been trading the financial markets since the mid-1990s. He head first into studying price charts, devouring everything on technical analysis that he could get his hands on. Then, he moved on to trading stocks in 1999, and started trading options in 2000. The one thing he’s discovered through it all is you can never stop looking for new ways to gain an edge in the market.