President Trump wants to spend on more infrastructure projects. That's music to the ears of industrial machinery company Caterpillar (CAT) - Get Caterpillar Inc. Report .

Caterpillar stock is trading below a long-term downtrend that goes back to the stock's all-time intraday high of $116.95 set during the week of Feb. 24, 2012. The secondary high that forms the downtrend is $111.46 set during the week of July 18, 2014. My proprietary analytics suggest this downtrend can be broken to the upside during 2017 if the Trump infrastructure spending plans are implemented before the end of the first half of the year.

Caterpillar was by far the best performer among the 30 components of the Dow Jones Industrial Average in 2016. Caterpillar stock was one of the eight "Dogs of the Dow" in 2016 and had a gain of 36.5% for the year. (The stock is not one of the "Dogs of the Dow" in 2017 by my methodology, because of the huge gain and because the stock's dividend yield is not among the best eight of the Dow 30.)

Analysts expect Caterpillar to earn 65 cents a share when the company reports quarterly results before the opening bell on Thursday. Zacks considers this earnings report as one of the most important economic indicators because the company is the world's largest producer of construction and mining equipment. Despite a weak mining industry, a strong dollar and weak economic growth in China, Zacks expect Caterpillar to beat earnings estimates.

Here's the daily chart for Caterpillar.

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Courtesy of MetaStock Xenith

Caterpillar closed Tuesday at $96.44, up 3.8% year to date, and in bull market territory 67.5% above its 52-week high of $57.46 set on Jan. 27. The stock is 13.7% above its Election Day close of $84.68 setting its post-election intraday high of $97.40 on Dec. 8.

The daily chart shows that Caterpillar has been above a "golden cross" since April 18 when the 50-day simple moving average rose above the 200-day simple moving average to indicate that higher prices lie ahead. This bullish formation also favors the strategy of buying weakness to the 200-day simple moving average. This average was tested several times between May 9 and May 24 when the average was $70.70. A subsequent test occurred on June 27 at $70.59, which was the post-Brexit low.

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Note that the price gap higher on Nov. 9 occurred on the realization that Donald J. Trump became President-Elect. The stock is on the cusp of its post-election high of $97.40 set on Dec. 8 as it prepares to report earnings before the opening bell on Jan. 26.

Here's the weekly chart for Caterpillar.

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Courtesy of MetaStock Xenith

The weekly chart shows a red line through the price bars, which is the key weekly moving average (a five-week modified moving average). The green line is the 200-week simple moving average considered the "reversion to the mean."

The study in red along the bottom of the charts is weekly momentum (a 12x3x3 weekly slow stochastic), which scales between 00.00 and 100.00, where readings above 80.00 indicates overbought and readings below 20.00 indicates oversold.

A negative weekly chart shows the stock below its key weekly moving average with weekly momentum declining below 80.00 in a trend towards 20.00. A positive weekly chart shows the stock above its key weekly moving average with weekly momentum rising above 20.00 in a trend towards 80.00.

The weekly chart for Caterpillar is positive but overbought with the stock above its key weekly moving average of $93.82. The stock is above its 200-week simple moving average of $86.03, last tested as the "reversion to the mean" during the week of Nov. 11, 2016 when the average was $86.07. The weekly momentum reading is projected to rise to 81.27 this week up from 78.62, rising above the overbought threshold of 80.00.

Note the downtrend going back to the highs of $116.95 and $111.46 set during the weeks of Feb. 24, 2012 and July 18, 2014, respectively. By the end of April this downtrend comes in at $105.19. Note also the steep uptrend going back to the low set during the week of Jan. 22, 2016.

Investors looking to buy Caterpillar should consider buying weakness to $92.57, which is a key level on technical charts until the end of January. This level was tested at the Jan. 9 low of $92.20. My semiannual value level is the lower buy level of $85.41 in play until the end of June. My quarterly value level lags at $69.53. Investors looking to reduce holdings should consider selling strength to $125.69, which is a key level on technical charts until the 2017, which implies that a new all-time high is feasible in 2017.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.