Patient investors should welcome the consolidation taking place in the aerospace, technology, and manufacturing giant Honeywell right now.
As you can see on the monthly chart, below, the stock has staged a powerful breakout in 2013 to all-time highs, surging above well-defined resistance at $62. I pointed out last October in this post that the industrials, as a group, were on the cusp of a major move, and Honeywell is indeed one of the top components in the XLI ETF.
Going forward, I am on watch for a buyable bull flag of several weeks of tight, sideways price action, or an orderly pullback down to the mid-to-upper-$60’s. I would not want to see the entire breakout given back immediately. Timeframe is key, and a broad market correction into the summer likely means market players should patiently layer in to their positions. However, after over a decade of finding supply above $62, the presumption is that this is a major breakout which should be stalked for entries on consolidations.
Earnings are scheduled for the morning of Friday, April 19th.
Also, my Weekly Strategy Session has been published and sent out to members this week. I am confident that you will find it to be of tremendous value in your weekly preparations for the market. It is never too late to sign up at a very reasonable price, so please click here for more details about subscribing or even making a one-time purchase (the subscription plans offer much better value over time). As a reminder, members of 12631 receive the Weekly Strategy Session at no additional cost, as it is included in their membership.
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