• Subscribe
  • Log In
  • Home
  • Daily Diary
  • Asset Class
    • U.S. Equity
    • Fixed Income
    • Global Equity
    • Commodities
    • Currencies
  • Sector
    • Basic Materials
    • Consumer Discretionary
    • Consumer Staples
    • Energy
    • Financial Services
    • Healthcare
    • Industrials
    • Real Estate
    • Technology
    • Telecom Services
    • Transportation
    • Utilities
  • Latest
    • Articles
    • Video
    • Columnist Conversations
    • Best Ideas
    • Stock of the Day
  • Street Notes
  • Authors
    • Bruce Kamich
    • Doug Kass
    • Jim "Rev Shark" DePorre
    • Helene Meisler
    • Jonathan Heller
    • - See All -
  • Options
  • RMPIA
  • Switch Product
    • Action Alerts PLUS
    • Quant Ratings
    • Real Money
    • Real Money Pro
    • Retirement
    • Stocks Under $10
    • TheStreet
    • Top Stocks
    • TheStreet Smarts
  1. Home
  2. / Investing
  3. / Stocks

I'm Spying Some Patterns in the Charts

Let's take a look at Caterpillar and others for clues about what's happening in the industrials and also track the moves of new fave Amazon and Apple.
By HELENE MEISLER
Jul 13, 2021 | 06:00 AM EDT
Stocks quotes in this article: CAT, DE, CMI, AMZN, AAPL

I don't spend much time discussing chart patterns with you, as I tend to focus on the indicators.

But sometimes chart patterns are worth pointing out and focusing on. For example, there is a tiny pattern that is developing in some of the industrial names, some of the financials, as well -- but since the financials are all reporting earnings this week, let's stay away from that potential landmine.

For the last few months, several industrial stocks have stalled out. I think the stall out began in the spring, as the growth and tech stocks began to bottom. But I don't think it became that evident, until the early June swoon that we saw in this group.

Take Caterpillar  (CAT) for example. That peak just over $230 in March was barely bested in May, so that entire move from March through early June was a giant sideways as I see it. But now look at how last week CAT had a higher low than mid-June. Now it has a flat resistance line just overhead around $220.

We can even look at a bit of a different picture with the other animal, Deere (DE) . A peak in March, a big sideways, a barely higher high and then a swoon. A higher low last week and a flat resistance line just overhead

Now take a look at Cummins (CMI) . It peaked in March, went sideways until June, and then swooned down, to a lower-low. But here, too, we see a higher low last week and now a flat resistance line. I haven't drawn in the longer-term uptrend line dating back to the November low, but that connects with last week's low, as well.

I look at these charts and am reminded that good charts turn bad and bad charts turn good. Do you remember way back in May when no one like growth and tech stocks? I know it's hard to remember, since now everyone likes them again, but let's start with Amazon (AMZN) , the new fan favorite.

Amazon came off that high in April, but really it was a marginal higher high vs. February, wasn't it? And then in May it swooned. But look: Early June brought a higher low and a flat resistance line. Folks were pretty iffy on Amazon until it managed to get over $3,300. Now everyone loves it, but isn't the pattern a little bit similar?

Now let's look at Apple (AAPL) , where I thought a move over $137 would peter out quickly, so I was wrong. But I wasn't wrong when I liked it at the lows. Here, too, we have a sideways stock that went down in early May, made a higher low in early June, had a flat resistance line, and finally broke out, because everyone had given up on it.

All I'm saying is that no one is even focused on the industrial stocks anymore. They loved them all spring. Adored them even. Now? Like they don't exist. And yet those little patterns are showing up. That has my interest piqued.

Elsewhere, I would simply not that the Daily Sentiment Index (DSI) for Nasdaq is now at 89, so if you're wondering how much love big-cap tech has, this is proof it has a lot.

 

(Amazon and Apple are holdings in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells these stocks? Learn more now.)

Get an email alert each time I write an article for Real Money. Click the "+Follow" next to my byline to this article.

At the time of publication, Meisler had no position in any security mentioned.

TAGS: Investing | Stocks | Technical Analysis |

More from Stocks

You Know What They Say About Dull Markets ...

James "Rev Shark" DePorre
Aug 18, 2022 4:37 PM EDT

Don't short 'em. Let's look at how investors responded to the thin trading and lack of big news -- and what we can expect to come.

With Oil, Keep Your Eyes on the Prize by Focusing on Supply

Jim Collins
Aug 18, 2022 3:59 PM EDT

The earth's oil supply is only going in one direction -- down -- and here's what that means for investors.

I Dislike Blue Apron But Here's a Trade, No Strings Attached

Mark Sebastian
Aug 18, 2022 2:30 PM EDT

The company is never going to make money and is likely heading back below $3 a share.

Europe's Recession Is All About Gas

Maleeha Bengali
Aug 18, 2022 1:30 PM EDT

Prices could very well stay elevated for a long time despite the economy going into a manufacturing recession.

The VIX and SPIKES Have Similarities, But There Are Meaningful Differences

Mark Abssy
Aug 18, 2022 12:00 PM EDT

And if you feel that volatility is an asset class that has a place in your strategy there are 2 funds that may be worth a closer look.

Real Money's message boards are strictly for the open exchange of investment ideas among registered users. Any discussions or subjects off that topic or that do not promote this goal will be removed at the discretion of the site's moderators. Abusive, insensitive or threatening comments will not be tolerated and will be deleted. Thank you for your cooperation. If you have questions, please contact us here.

Email

CANCEL
SUBMIT

Email sent

Thank you, your email to has been sent successfully.

DONE

Oops!

We're sorry. There was a problem trying to send your email to .
Please contact customer support to let us know.

DONE

Please Join or Log In to Email Our Authors.

Email Real Money's Wall Street Pros for further analysis and insight

Already a Subscriber? Login

Columnist Conversation

  • 02:23 PM EDT STEPHEN GUILFOYLE

    We're Cleaning Out This Retailer From the Bullpen

    Check out the latest moves in TheStreet's Stocks U...
  • 10:24 AM EDT JAMES "REV SHARK" DEPORRE

    This Weekend on Real Money

    To Improve Your Trading and Investing, Spend More ...
  • 08:44 AM EDT PETER TCHIR

    CPI Beats Expectations, But Maybe Not the 'Whisper'?

    Slightly better-than-expected inflation across the...
  • See More

COLUMNIST TWEETS

  • A Twitter List by realmoney
About Privacy Terms of Use

© 1996-2022 TheStreet, Inc., 225 Liberty Street, 27th Floor, New York, NY 10281

Need Help? Contact Customer Service

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data & Company fundamental data provided by FactSet. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by FactSet Digital Solutions Group.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

FactSet calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.

Compare Brokers

Please Join or Log In to manage and receive alerts.

Follow Real Money's Wall Street Pros to receive real-time investing alerts

Already a Subscriber? Login