Caterpillar (NYSE: CAT) Long Term Technical Analysis June 2019

CAT Long-term outlook

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CAT share prices bottoming out since 2016 near the monthly SMA 200 and rallied from as low as $56.36 to all-time high $173.24 in two years. Since the all-time high at the beginning of 2018, the share prices consistently move lower and reach as low as $112.06. At the current time, CAT traded at $135.26 or around 23% from the top.

Traders and investors are mostly optimistic about the company future as President Trump laydown infrastructure program. But, next year election might put the share prices under pause for a while. We might see consolidation continue until the election result announced. At the current time, traders could safely buy the stock if it makes pullback lower.

New Month

Monthly chart

On the monthly chart, since CAT reach all-time high $173.24, the share prices consistently moving lower. There is a flip level where resistance turned support between $100.00 – $115.00. Long positions near the area are the best options traders could take. However, the chance might not available again for a while as the share prices bounce from the level near it this month.

If the share prices continue upward then it will test the bearish trendline. Will the bull manage to break higher above the trendline?

Weekly chart

Zooming in the weekly chart, we could see triangle consolidation in CAT share prices. No breakout of the range yet and it looks like CAT will continue inside the pattern. At the current time, CAT is moving near the top of the triangle. We will see a test on the resistance soon.

Daily chart

CAT outlook on the daily chart seems bearish inside the green bearish channel. However, the share prices manage to climb above daily SMA 200 recently. CAT next trend will depend on how the share prices reacted at the SMA 200. A lower close below the averages will trigger selling. On the other hand, a breakout above the green channel will lead the share prices toward top trendline.

Trade plan

A long position could be taken near $100.00 – $115.00 support area. The short-term position could be taken near the daily SMA 200.

A short position could be taken near the top trendline on the weekly or daily chart. Another short position to consider is when a breakout below daily SMA 200 happen.

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