NFTRH+; A Boring Co. w/ a Great Chart

Maybe in a market like this, boring is not so bad.  The things gaining on momentum now will decline on momentum when the rally ends.  Against a general high risk atmosphere in stocks those looking for long positions might look in some out of the way places, like this Milwaukee based manufacturer of motion control and water management systems, Rexnord.

It’s got an old fashioned sounding name, it’s got an old fashioned product line and well, it’s in Milwaukee.  As an American manufacturer, it also in my opinion, fits the profile of a company that could benefit from certain Trump administration policies going forward.  This reminds me of a similarly boring NFTRH+ idea from 2016, Cabot Corp. (CBT), maker of ‘Carbon Black’.  That trade worked very well.

This idea was sent to me by a sharp subscriber named Joe, and if it goes well the credit goes to him, not me.  I am simply a ‘see chart, like chart, tell subscribers about it in the event they’d like to take a look at the company’ middle man in this case.  So, onto the charts…

The daily sports a pattern that immediately jumped out at me.  I have seen this thing before and often, though not always, it’s setup proves profitable.  To be sure, this is just a fledgling break above the necklines (plural, as it is open to interpretation) but a break and hold above the red dotted line measures a target of 28.50.  MACD and RSI look good and excellent, respectively, and AROON shows a daily uptrend for most of 2017.

rxn daily chart

The weekly chart shows the broken downtrend and two moving averages crossed upward.  Notice how well they worked to signal a big oncoming decline when they crossed downward in early 2015.  Other highlights are the constructive weekly MACD, very healthy (though not overbought) RSI, AROON up and some big volume coming in recently.

rxn weekly chart

Buy Target:  Current levels.

Sell Target:  28.50 or anywhere lower that profit is considered acceptable.

Stop Loss:  A trader can use anything from an ultra tight stop below the green neckline and/or 22.50 to 22 or the daily chart’s SMA 50.  A longer-term trader or investor can use a stop below 21, which is the area of the daily SMA 200, the weekly EMA 50 and the former downtrend line.

A reminder that chart based NFTRH+ updates are technical trade setup ideas, which may not be revisited as the buy, sell, stop parameters are already noted. They are meant as a starting point for further research if interested. I will not personally buy every item highlighted and will sometimes sell – without prior notice (because this takes time and resource away from NFTRH’s main functions) – any item that I do buy, below target, which is something I often do as a trader. Also please be aware that I am not a fundamental stock analyst. Due diligence is your responsibility.