Caterpillar Is Close to its 50 Day Moving Average

Published on Friday, 17 August 2012 08:44 Written by TradersHuddle Wire

New York, August 17th (TradersHuddle.com) - Caterpillar, Inc. (NYSE:CAT) closed the trading day at $88.59, near its 50 day moving average that is set at $84.71. Caterpillar's price action is just above this important support level, providing a trading opportunity.

Caterpillar Inc. (NYSE:CAT) designs, manufactures, and markets construction, mining, agricultural, and forestry equipment. The Company also manufactures engines and other related parts for its equipment, and offers financing and insurance. Caterpillar, the largest earth moving equipment maker in the world, distributes its products through a worldwide organization of dealers. The maker of bulldozers and excavators was founded in 1925 and headquartered in Peoria, IL.

The peaks and troughs algorithm shows calculated support at $82.10 and calculated resistance at $89.65. These levels should also be evaluated when planning trades, as they provide an insight into the latest price action.

Traders wanting to establish a position on Caterpillar should look for evidence of buying near the 50 day moving average, and open this position as close as possible to this important level. Also, they need to consider the latest range defined by the peaks and troughs algorithm for insights on other key levels that might impact an upside or downside move.