US Steel (X)

US Steel (X) is a company that is considered part of the “Trump Trade”. The Trump Trade basically stands for companies that stand to benefit from the President’s policies and agenda. From what I have seen reported, infrastructure spending is a key component of his agenda.

Infrastructure spending could help boost companies that provide materials for infrastructure, like US Steel (X).

And when the President mandates that pipelines that he just re-opened up for completion are required to be built with steel produced in the USA, even better. US Steel and Mittal Steel stand to be the beneficiaries of those Presidential orders.

Some infrastructure stocks have already made significant gains. Let’s review some charts for US Steel (X) and see how it stacks up to the competition.

US Steel (X) – 20 Year Chart

Today should provide for an interesting day considering US Steel (X) released its earnings yesterday after the close. Today’s activity notwithstanding, let’s try to forecast the share price going forward. It would probably be best to revisit this forecast in about 2 weeks after earnings activity is baked into the stock a little better. But let’s start the review anyways.

This first chart is a 20 year monthly candlestick chart for US Steel (X). In December 2016, US Steel’s share price developed a Shooting Star candlestick pattern. A Shooting Star candlestick pattern is a bearish reversal candlestick pattern.

If the Shooting Star candlestick patten is signaling temporary weakness, the supporting trendline could offer an opportunity to go long the stock and make a scale-in purchase. The supporting trendline currently sits around the $23 area.

Analyzing a 20 Year Monthly Candlestick Chart for US Steel (X)

The MACD Histogram on this monthly chart is showing increasing buying[s2If !current_user_can(access_s2member_level1)]….

If you want to continue reading this article for US Steel (X), you must first login. I continue discussing its upside minimum trade that I would anticipate as well as pullback areas to make scale-in purchases for the current uptrend.

If you are not a Trendy Stock Charts member, consider subscribing today! There are several different subscription plans available.[/s2If][s2If current_user_can(access_s2member_level1)] momentum. Use any slowdown in February 2017 as part of the scale-in strategy to pick up some shares.

X – Scale-In Opportunity

So the 20 year chart came up with a $23  – $24 scale-in opportunity. Let’s change views and see what the next view indicates. This next chart for US Steel (X) is a 2 year weekly candlestick chart.

The Fibonacci Extension Tool that I placed at the beginning of this uptrend illustrates that X’s share price reached the Golden Ratio of the uptrend. The Golden Ratio is the 161.8% Target Line. Some stocks break through the 161.8% Target Line on their initial attempt. Those stocks are really special. But most tend to consolidate after reaching their Golden Ratio. That is the opportunity to join the uptrend for the next leg up.

Determining Short-Term Support Areas to Purchase Shares and Join the Uptrend for US Steel (X)

During the current uptrend, one of the things I like on the chart is the fact that all the above average days in trading volume are buying volume days. That confirms to me that the next pullback is one that can be used to scale-in to some shares and go long the stock. A pullback to the main supporting trendline would be an ideal spot for a scale-in purchase.

The MACD Histogram is back towards the zero reading right before earnings. Watch to see the next movement (buying or selling momentum) after the completion of today’s earnings activity.

There is a Rising Window candlestick pattern support area I illustrated on the 2 year chart. The support area is right below the 100% Target Line from the Fibonacci Extension Tool. This area should provide excellent support during ay pullback in US Steel’s (X) share price.

US Steel (X) – Summary

With positive earnings activity today, X’s share price could make a run back towards its previous high before starting any sort of consolidation period.

But if X’s share price does start pulling back this week, start to monitor the area below $30. Closer to the $23 – $24 area on a break below the $30 level.

For today, Any drop towards the $30 area on earnings day today could be used as a trading opportunity for a bounce.

I will revisit the charts for US Steel (X) after a couple of days of earnings activity plays out. In the meantime, ask any questions in the Idea Chamber.

Good luck trading!!