The share price of U.S. Steel (X) has been under some selling pressure Friday as some investors were not enamored with its outlook for the current quarter. Let's take a look at the charts and indicators to make up our own minds.
In the daily bar chart of X, below, we can see that the shares have been moving sideways since May. X has traded above and below the 50-day and 200-day moving average lines many times. Currently, X is trading below these two indicators.
The daily On-Balance-Volume (OBV) line has also moved sideways for many months and suggests a balance between aggressive buying and aggressive selling. The Moving Average Convergence Divergence (MACD) oscillator is in sell territory but poised for a cover shorts buy signal.
In the weekly Japanese candlestick chart of X, below, we see a mixed picture. The shares are trading just below the cresting 40-week moving average line. A small rally would put X back above this indicator.
The weekly OBV line made a low in early October and a higher low in early December -- this could mark a turn higher. The MACD oscillator has narrowed and is close to an upside crossover and potential buy signal.
In this daily Point and Figure chart of X, below, we can see an upside price target in the $27 area. A start.
In this weekly Point and Figure chart of X, below, we can see an upside price objective in the $48 area.
Bottom-line strategy: Many, many years ago I worked in the old U.S. Steel headquarters building at 71 Broadway in New York City. It was a time when companies located near the New York Stock Exchange or the commodity exchanges. Today the building houses upscale apartments. In the short run some traders may be focused on day-to-day news but investors in X should win out and we should see X work higher. If you probe the long side you should risk just below $20.
