Sunday, March 25, 2007

There Is Strength In Steel

Every week or so I run a few scans to find stocks that are showing relative strength and weakness. There is one group of strong stocks that have continuously showed up on my scans over the past few months and they are the steel stocks. The index I use is STQ or DJUSST.

The chart on top is the Steel index(STQ) and right underneath it is the S&P 500. Notice when the S&P was making lower lows the steel stocks were diverging and making higher lows. This to me is very bullish and I apologize for not posting this chart last week. As you can see the steel index has already broken out to new highs.

If you look at the next chart you will see 3 steel stocks (X, IPS and AKS). There are a few other steel stocks that are acting well, but I chose these 3 because I trade them quite often and they are also just beginning to breakout now.. I think this is a good group of stocks to watch if you are looking to buy this market. Keep an eye on them, they look pretty good.

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