First up this week is large-cap power management company Eaton (ETN - Get Report). It's been a fairly rough year for shares of Eaton. The stock has slid more than 7% in the last year, underperforming the S&P 500 by a fairly wide margin. A new technical setup in shares points to a turn-of-fate for shareholders, however.
For the last couple of months, Eaton has been forming an ascending triangle -- a bullish setup that's formed by horizontal resistance to the upside and uptrending support support and resistance below. Eaton broke out above that resistance level this week, triggering a buy signal for traders. The lack of another meaningful resistance level nearby means that this stock could have plenty of room to move higher.
Momentum, in the form of 14-day RSI, has been trending higher since August, a factor that adds some extra confirmation to this triangle setup. As long as the uptrend in RSI remains unbroken, traders should feel good about this breakout. I'd recommend keeping a protective stop at the 200-day moving average.Eaton, which has a B buy rating from TheStreet Ratings, is one of the highest-yielding industrial stocks and shows up on a recent list of 5 Stocks With Bullish Insider Action.