Joy Global (JOY) seems to be at very interesting spot technically. This shortened day chart of ~ 6 months I have posted maps the range from recent highs around 66 to lows in the are of 54 and shows the typical H & S top formation marked out on the chart. The following scenarios can guide us to a potential trade in either direction. Personally, I’m looking for a long side break or pullback to support as an entry offering a better risk : rewards set up. See my post last week for why: http://wp.me/p2oNy1-4b
At this point, JOY is at the top of the shoulder and at the 200 ma. Both huge resistance. The RSI is pressing the same level. The positive aspect is that it has been resting at these levels for 5 sessions. The support of the 20 & 50 (sloping upward) trend lines (blue arrow) offers a nice base in the event of a pullback. A breakout in price (I doubt we see volume) above last weeks highs can lead to test the 66 level again. I usually harp on a week chart to support any “technical” pattern, but the weekly charts show the exact same patterns on the week bars. Basically, there is plenty of room if the 66 level breaks and can head to the 71 level. Any breach of 58.50 and the long side game plan is a bust! I would not short this until that 50 MA slopes turns down. or simply avoid any trade in JOY.
A few symbols to watch for the group might include: AGCO,CNH,ASTE,CMCO,DE,GENC. Also watch TSCO and CMI.
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