ITC Holdings

Normally, utility stocks are a bastion of safety when times get markets get rough. But that doesn't look like it's the case with power company ITC Holdings ( ITC) right now. Instead, ITC is showing investors a bearish bias. Here's how to trade it.

>>5 Stocks Set to Soar on Bullish Earnings

ITC is currently forming a descending triangle pattern, a bearish setup that's formed by a downtrending resistance level above shares and horizontal support to the downside. Basically, as ITC bounces in between those two technically important price levels, it's getting squeezed closer and closer to a breakdown below support at $86. Don't let yesterday's relative strength in ITC fool you; sellers are clearly in control at higher levels.

The sell signal comes on the breakdown below that $86 support level. That's the signal that this stock's unable to catch a bid at a price that's previously acted as a sort of floor for shares. If you decide to actually go short on the move through $86, I'd recommend keeping a protective stop right at the 50-day moving average.

If you liked this article you might like

Downgraded AIG Isn't Finished Falling

Downgraded AIG Isn't Finished Falling

Former AIG CEO Greenberg Can Pursue Defamation Suit Against Spitzer

How to Make Easy Money on Apple's iPhone X Worldwide Reveal: Market Recon

Hurricanes Irma and Harvey Might Cost $100 Billion, Dealing Big Blow to Insurers