Our new play tonight in in the transportation sector but I wanted to alert readers to STX.
Seagate Technologies (STX) out performed the market with a 5.2% rally thanks to some positive analyst comments this morning. The stock surged right to its November highs and stalled. Shares have potential but I don't want to chase today's move with the market sinking into the close. I'd put it on your watch list and wait for an entry point.
NEW BULLISH Plays
GATX Corp. - GMT - close: 30.52 change: +0.71 stop: 28.49
Why We Like It:
The transportation sector looks ready to lead this market higher. GMT happens to be a component in the Dow Jones Transportation index. The stock is already breaking out to new eight-week highs. If this sector continues to climb GMT looks poised to outperform. However, one quick note, this is probably an aggressive entry point. If you look at the January 2009 peak, the May highs, and the September highs, you can see the trend is one of lower highs. GMT has not yet broken that trend. While I am suggesting small bullish positions here more conservative traders may want to wait for a rise past $30.75, which would over take the September highs and break the trend.
Our target is $34.75 but that's pretty optimistic since we plan to exit ahead of the late January earnings report.
FYI: GMT's business involves both the railroad industry and shipping industry.
Entry on December 16 at $30.52 -use small positions-
Change since picked: + 0.00
Earnings Date 01/21/10 (unconfirmed)
Average Daily Volume: 314 thousand
Listed on December 16, 2009