It really is quite amazing. I feel like a kid in a candy store. There are so many long side setups now that it is hard not to find one out there. It is a result of the strong bullish persistence in the broad market as it rebounds out of the depths of its bear market lows.
US Steel looks like it is close to completing a very large inverse head and shoulders pattern of almost 1 year duration. You can see from the chart the blue line resistance area that marks the neckline of this pattern. US Steel tends to be a somewhat slow moving stock, but I believe once above that resistance line it could get a good run going as it would signify a breakout from the pattern.
For the breakout to be valid we need to see a wide price bar spread and sufficient volume. The timing of the breakout can be somewhat tricky going into August soon. I know I have already said it a million times but at least some caution is advised during this time of year because of higher possibility of false breakouts and reversals.
Still, the pattern here is undeniable and the setup quite attractive. Another one to add to the watch list that seems to be growing by leaps and bounds day by day. There are so many good setups right now. Looking at all these individual stocks is a great way to see ‘inside’ the averages. Patterns like this in US Steel are supporting sustained moves in the market averages.