A quick one tonight. Just keeping it simple. When it comes to the world of big machinery, Navistar has it all. I don’t only mean their line of products, but also the technicals and intrigue factors that you like in a potential breakout play. Carl Icahn is involved, who cannot like that? There is 14% short interest, an automatic buy and cover mechanism built into the future. And look at the weekly chart. It is building a series of Cup and Handle patterns, with the latest giving a projection to 58.50 on a move back over 38.50.
The Relative Strength Index (RSI) is bullish and rising and the Moving Average Convergence Divergence indicator (MACD) is running higher as well. All signs point up. Look for a move above 38.50 as your entry on a stock trade. As an options alternative, you might consider an October 40/55 Call Spread for about $3. Lighten the load up front by selling June 40 Calls for $1 if that suits your fancy.
The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.
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