Martin Marietta Materials
It's been a pretty lackluster year for shares of Martin Marietta Materials (MLM). The $5 billion construction product maker is up a whopping 2.7% since the start of 2013, underperforming the broad market by a big margin. But that's not what makes MLM look toxic right now. Instead, there's a new technical setup weighing on shares this summer.
MLM is forming a head and shoulders top, a bearish reversal pattern that indicates exhaustion among buyers. The head and shoulders is formed by two swing highs that top out around the same level (the shoulders), separated by a bigger peak called the head; the sell signal comes on the breakdown below the pattern's "neckline" level, which is right above $95 at the moment. A sustained drop below that $95 level is the major sell signal for this stock.MLM has been forming this setup in the long term, a fact that points to long-term trading implications when and if the setup triggers. If you decide to go short MLM on the breakdown, I'd recommend keeping a protective stop on the other side of the 50-day moving average.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV