CAT blue chip industrial LONGCAT on the daily chart has trended down more or less since the last earnings beat 6-7 weeks ago.
It has now found support at the 0.5 and 0.612 Fibonacci levels confluent with the mean VWAP
anchored back 6 months. The Bollinger Band Trend shows a narrow band with for the first time
this year. The Relative Trend Index is negative but about to go neutral. I see this as opportunity
to take a long trade well ahead of the next earnings. I assume CAT may have solid earnings
in the current quarter as its equipment production is purchased by those in the construction
industry making expenditures for residential as well as road construction and repair.
The Chris Moody RSI indicator shows both lines inflecting in bullish divergence which supports
a long trade.
