Quick educational chart post highlighting GMT – GATX Corp, a stock that is offering ‘Blue Sky Potential’ as it is entering all time high territory and has no Overhead Resistance. Everybody holding the stock is in the green. From a purely psychological perspective selling pressure is greatly reduced as neither traders nor investors are experiencing any kind of pain and as of yet there is basically no reason to sell. Followers of my public chart list know I added a Railcars – Sector Overview Chart a few weeks ago. The whole sector is on fire and GMT ended up being my choice because earnings are out of the way. Although I own a position in GMT I wouldn’t recommend chasing here. The post is meant to be educational as I often talk about overhead resistance and the psychological implications of stocks trading near or at an all time high.
GMT – GATX Corp. Click on the chart to enlarge:
The chart annotations show how I derive a technical price target and what other factors play a role in determining the most likely target area. In this case I make additional use of ‘soft factors’ like ’round number psychology’.
The main reason why I decided to publish this post is the following: The past two weeks you will have noticed that the market has literally been forcing me to become bullish on the commodities theme. Hence I started opening positions in various commodities. The interesting thing about GMT is that I consider it to be commodity related as transportation stocks like railcar companies are needed to move various commodities around the globe. By the way, did I mention FRO – Frontline?
Company overview from Yahoo finance:
GATX Corporation leases, operates, manages, and remarkets assets in the rail and marine markets in North America and internationally. The company operates in four segments: Rail North America, Rail International, American Steamship Company (ASC), and Portfolio Management. The Rail North America segment primarily leases railcars and locomotive, as well as offers pays ad valorem taxes and insurance, and other ancillary services; operates a network of service facilities that perform repair, maintenance, modification, and regulatory compliance services on the railcar fleet; and provides maintenance services, including interior cleaning of railcars, general repairs to the car body and safety appliances, wheelset replacements, exterior blast and painting, and car stenciling. The Rail International segment leases tank cars and flat wagon railcars, as well as offers repairs, regulatory compliance, and modernization work for railcars. The ASC segment operates a fleet of vessels that provide waterborne transportation of dry bulk commodities, such as iron ore, coal, limestone aggregates, and metallurgical limestone for automobile manufacturing, electricity generation, and non-residential construction industries. The Portfolio Management segment invests in operating assets, finance lease assets, and secured loans, as well as manages portfolios of assets for third parties; and provides leasing, asset remarketing, and asset management services. As of December 31, 2012, it operated a fleet of 18 vessels, as well as approximately 131,000 railcars and 561 locomotives. GATX Corporation was founded in 1898 and is headquartered in Chicago, Illinois.
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