AKS - Stronger than Steel

Trump’s America was supposed to be the champion of the steel industry.  Taking a look at November just prior to the election you see the steel market start to react to an actual possible trump presidency.  Despite whatever political beliefs you have, you must recognize the great wealth Trump will bring into the infrastructure and steel industry in the USA.  Having spiked initially and trending down since early December, AKS seems to be fighting to find a bottom.  That might not be here yet however.  Looking at this last day, there has been fundamentally one big concern.  Trump’s follow through with the building of the wall and his ability to deliver on tax reform early in his presidency.  With massive doubt surrounding his wall claims and heavy scrutiny, the steel industry appears to be faltering.  Materials today in general are getting beat harder than a red headed step child.

If you have bought in under 7 fear not, even if you have bought under 7.50 fear not.  This stock will not be held down.  Let’s look at the past 9 months.  There are three support/resistance zones that I see formed.  Currently at the $6.00-6.15 zone, way down at $4.68, and slightly under $8.00.  Having been trending down I see this going back to touch the $6.00 mark again in the next 2 days, but come Monday I expect a rebound.  If tomorrow closes red and Friday closes green in a doji or hammer, this will fly.  Heading down to hit the $6 mark, a double bottom will be formed on the daily chart showing this is ready to start getting more buying pressure to drive price up.  While I would hold off on buying if you aren’t in yet simply because I think this will touch $6, I wouldn’t sell yet.  The RSI is not weak enough to indicate a strong enough buy, the MACD is not showing much signs of real movement, and the stock needs to drop more to reach the support zone of 6 and that lower Bollinger band.

If you see the $6, buy.  This is not a $5.00 stock, this is a $9.00 infrastructure play that will hold up well past the Trump reign.  Although I should have sold the peak today instead of holding, I will continue to hold.  I refuse to sell my position under $8.00.  I firmly believe that this will rise.  The past few large gap downs, it took a few days before the stock spike back up.  If you buy at $6.00 or lower, sell as soon as you see the 4-6% gains.  You can see in the 3 month down trend this has been on no spikes have held more than a day or two.

 

If you want to be short term, $6.00 is a good entry for a swing up to $7.00 or $7.50.

 

If you want a long-term hold, $AKS is also a perfect candidate to touch the $10.00 mark by the years end again.  The entry for a long position can be much looser and any position entered under $7.75 is a great position to be in.