Today, we are going to look at Caterpillar Inc (CAT) which we last commented on in the June 14th edition of the Daily Stock Report when it just entered the Favored Zone in the SIA S&P 100 Index Report at a price of $245.44. Now the shares are at $274.51 representing a 11.8% increase in just two months time. The shares currently occupy the #5 spot in the S&P 100 Index, up 1 spot in the last week and 49 spots in the last quarter.
In looking at the attached Candlestick chart of Caterpillar Inc, we see that the shares found support at around the $210.00 area where it trended there from March to late May of this year. The shares subsequently gapped up in early June after it broke out of its downtrend line and a new rising trend has emerged which continues up to today. Most recently, we see the shares gapped up again on Aug 1st when the shares reported a very positive earnings release which the markets looked upon quite favourably as they announced second quarter 2023 sales and revenues of $17.3 billion which is a 22% increase compared to second quarter of 2022. The increase was due to higher sales volume and favourable price realization. Now we see the shares have made new all-time highs when the shares broke above the $260.00 level. Next potential resistance can be found at approximately $290.00 and then $310.00 based on measured moves. Support can be found at $260.00 where the shares were at prior to the recent gap.
In the attached Point and Figure Chart at a 2% Scale, we see the share’s strong rally starting in June of this year which has culminated in a column X’s currently lasting 16 rows with the shares exhibiting a bullish Spread Double Top. Support can be found at the 3-box reversal at $262.64 and, below that, $233.32. After such a strong move currently, we can see near term resistance quickly approaching at $295.78, and then $307.73 based on a measured move.
With an SMAX Score of 10, CAT is exhibiting near term strength against all the asset classes.
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