US Steel X should be the best steel play now. compared to NUE, STLD, $MT, AKS. $X

The Steel sector has not been doing well this year due to the huge increase in raw materials (Iron Ore and metallurgical coal). Operating margins have been squeezed as a result.

While many steel companies rallied to their highs (such as steel dynamics and Nucor), US Steel is still trading at a rather low multiple.

Since US Steel has its own iron ore mines, I feel that this company should benefit the most from rising iron ore pricings as compared to its peers. As a result, I am thinking that the other steel companies are overvalued compared to US Steel.

It is true that currently, US Steel has one of the worst operating margins due to its method of making steel as compared to mini mills. However, the huge increase in steel pricings (taking effect this Jan) should help US steel by a huge margin.

I am bullish on US steel once again.

I have a target of $60 in sight, and I will consider selling it there as traders might short and sell it there too due to the strong resistance at that level.

Currently, the stock has bounced from its support, this is a good time to accumulate US Steel shares as the market seems to surge higher to 12800.

Watching the steel sector. X, PKX, MT, STLD

With the rally looking set to continue, I am watching the steel sector for good plays.

My favorite steel company is X as steel demand and pricing seem to be favorable in the next few quarters.

PKX is a good asia play, it has lots of investment in emerging markets like India, Indonesia.

STLD is a scrap steel play.

Expect a 20% appreciation of stock prices in the steel sector.

Catalyst:

Obama’s high speed rail

China’s continued growth

Declining Iron Ore prices

Following up on US STEEL sell.. Option pain is at $52.5. $X

US STEEL has options expiring next week, and the most pain to options buyers would be when the price of US Steel drops to $52.5

Again, this is pure option pain theory, which suggests that the Options sellers would want their options to expire worthless, and the MMs will drive the stock to the price that would achieve this maximum pain to option buyers.

The trade can be done today.

Furthermore, UBS has already advised its clients to make a bearish trade on X by selling calls at high strike price and buying PUTS. UBS feels that the steel pricing is a little to high, demand is not that high yet. However, Mittal suggests otherwise, leading to the 1% increase of steel stock price.

Who to trust… UBS or Mittal?

Sell steel stocks. AKS and X are main targets.

As iron ore prices skyrocket, AKS will experience severe shrinking margins. United States Steel is in better hands but will face weakness as well.

As the housing market continues to be weak, construction spending will not increase significantly.

Steel prices face high resistance as buyers are not willing to buy at a higher price with the current economy.

For the short term, Steel stocks are a sell, while iron ore stocks are a buy. (to hedge risk).

Double tops are forming for both AKS and X, and technical traders will target this formation to short these stocks.

If you are interested in a short, time it with the market correction. The DOW is still facing buying pressure as retail continue to flock into stocks.

doji doji! very interesting. 6 DOJIS!

^ dojis in a row, this is one of the coolest chart pattern that I have not seen in my short trading experience.

Any one who knows what the outcome of such formation, please leave comments.

My take is that the market is consolidating in the tightest range possible. And any breakout is going to be phenomenal.

What is good for the LONG? QE2.

However, QE2 is already priced in. I am afraid that if QE2 is below $500billion, the market could breakout downwards.

I am not afraid of a rally continuation. I am only afraid that the market will crash downwards!

For now, I am continuing to watch my focus list. I am striking out MGM from it and lowering my buy order for US STEEL: X to $37

Just closed my long position on US STEEL X.

Looking at the daily chart of the SPX, it seems that we have made a double top. I am wary of a correction, hence, I am selling my profitable long trades in the metal names such as US STEEL which hit my buy order at $40. see my focus list… http://tradedragon.blogspot.com/2010/10/tradedragon-focus-list-suggested-buy.html

I have closed it out at $43.5 for a nice 9% gain.

---> The_Big_L: hi, I will be back after 3.30pm today, I am waiting to get BAC at $11 and $10.8

Okay, gotta run to my exam. Happy trading peops.

Why steel stocks are dropping? Buy when everyone is fooled. United States Steel. $X

Recent brokers comments have caused steel stocks like US Steel to take a beating.

Goldman Sachs downgraded US Steel after a failed pump a few months back.

Credit Suisse lowered estimates after it met with United States Steel CEO at CS’s metals and Mining Conference in London.

“Q3 demand is now looking weaker than previously expected, and Q4 will be down from that level; the company’s manufacturing utilization rate in Q3 in North America is going to be lower than Q2’s 82%; 2011 automotive demand is not looking good, with orders so far below expectations; lead times are compressing, from 6 to 8 weeks to 3 to 4 weeks; met coal costs are squeezing margins.”

The housing market has been really bad lately. Traders are betting on a double dip in the housing market, and they are right unfortunately.

Technicals to start buying US Steel stocks.

2 buying levels are observed.

B1 - $41.5
B2 - $39

If tomorrow’s new housing sales figure is bad, then B2 is the better option.

US Steel pullback. Buy lower.

 

Remember this chart which I drew a few days back. US Steel did indeed bounce off 46. However, I am looking to buy way lower given the current market outlook.

Futures are now in the green, however, I will stay at the side lines. If you really want some pie of US Steel, today is the day.

US STEEL rose 5% while the market sank 1%

Why did US STEEL rise so much today?

Buyout rumors? M&A activities?

My guess is that OBAMA’s 150BLN railway plan is going to see some money trickling into US STEEL bottom line.

This is why US STEEL rose so much today.

Too late to enter the railway rally? Not really.

I will wait for a correction. The DOW seems to be weak and may extend its losses tomorrow. I will be thinking to buy at $46.5 if the correction allows it.

However, should the market be further depressed, lower price may be seen.

Market might be in a BEAR mode for a while longer.

Today, the DOW continues to slight, removing all hopes of a recovery. The market is in a bear trend now. Any long positions would be punished by market players.

Hedge long positions with some shorts.

US Steel surprisingly held its support level and stayed in the green despite the red DOW. All its peers are trading 2% down. I might be watching the market carefully, any downward signal would be nasty for US Steel too and it may test a lower support of $41.

US STEEL is a screaming buy now. $X

United States Steel is going to be the stock that would outperform this uncertain market.

The stock has held up really well at $52.81 now. Volume today was at its highest, which shows that there were more buyers at these low price than sellers at yesterday’s higher price.

US steel has been placed in Goldman Sachs’ conviction buy list. This is a plus point. The last time Goldman Sachs placed US STEEL in its conviction buy list, the stock rose from $40 to $66.

This time, it is possible that the stock rally from $52 to $77.

US STEEL is my best buy idea for this month.

United States Steel finally gains strength. $X

Get ready for the next rally of United States Steel. This is the reversal that we have been waiting for.

It has bounced on its 200EMA, and it has closed above the 61.8% FIB line. This is very bullish in technical sense. Fundamental wise, X is very strong and it should be trading at $90 if that GREECE downgrade did not occur.

This is the best time to add positions to X. I have closed short positions in CLF and HOT, and I am adding on to X.

Bullish target of $82.

United States Steel fail yet again. $X

Today, United States Steel disappointed all longs when it could not confirm the bullish harami. It is back in consolidation mode.

This is partly due to the poor management of CLIFFs, CLF which did not give any guidance. CLF fell 8% as a result, dragging US Steel with it.

However, should the market continue to advance tomorrow, I foresee X to climb very rapidly. I am still waiting for a 5% gain and that would kick start the next bullish rally.

Today’s candle stick resulted in a breakdown of the bullish harami. This is the 5th time it is touching the $56 level.

A sharp rally is on the way.

2 Upgrades didnt help. Goldman Sachs upgrade did not lift the sentiment. This is as low as it could get. I have added more X at $56.8 today.

United States Steel Bullish reversal. Harami. $X

United States Steel formed a bullish harami today. Should tomorrow candle close above $59, this is a confirmation that the trend for X is long. Given the weak market condition today, the 2 upgrades by GOLDMAN SACHS and DAHLMAN did not help lift X much.

Expect more upgrades soon as X finally gets to realize its potential as a leading integrated steel provider while the other steel companies suffer from high iron ore charges.

X is a strong buy here. Profit target is $82.

US STEEL $X Beats Estimates. Shares rise by 2% Pre-market.

 

US Steel is going to be profitable next quarter onwards. This is in line with all the analysts forecast. US Steel is not overvalued

Looking ahead to the second quarter, Surma said, "We anticipate being profitable in all three of our operating segments in the second quarter of 2010 as gradually improving business conditions should be reflected in our operating results, most notably for our Flat-rolled segment.

 

A break above $61.7 would trigger a short squeeze towards $65.

Wrong about Metal Stocks. $X, $FCX all rose. Santander is a buy again. $STD

$X could head extremely high up if it beats estimates tomorrow. I would not be surprised if it jump 7% due to short squeezing.

The market is going to be consolidating.

I bought some Banco Santander stocks $STD at $13.30 ahead of their dividends EX DATE 28 APRIL, and earnings.

United States Steel will dictate the next move in the metals market.

Looks like United States Steel may not drop after all. Long $X

Caterpillar beat earnings, this is a booster for materials stock.

Commodities are on the rise again as investors increase their risk appetite.

United States Steel $X chart looks bad now.

United States Steel might drop below today’s close of $59.20 and there’s one more support at $54 should the DOW starts it correction.

Today, the market pushed up to a new high – 11200. There was significant selling pressure as many traders are now doubting the sustainability of the speed of this rally from 9800 to 11200! There was never a 1400 point rise since the MARCH low last year. This means that this rally is one of the strongest ever, and it is due for a consolidation, not a major correction.

Dow should correct to 10800 soon.

I am closing positions of Alcoa Inc, Bank Of America Corp, SanDisk, Micron Technology, AES corporation.

I am net short United States Steel till its earnings next week. I think it would be weak just after the earnings.

Bottom fishing. United States Steel bottoming out. $X.

Looks easy to draw those lines and give United States Steel an $85 target.

X seems to be bottoming out here. It has created a short triple bottom on its 50% FIB line.
Today, NUCOR released its earnings which beat analysts’ estimates.

So far, all the STEEL companies have beat their own guidance and their analysts’ estimates.

United STates Steel will be releasing their earnings after market next Monday. There are 2 more trading days before this results. Most probably, shorters would be closing their short position, while some edgy investors may close their long position.

I see a tight range going close to the earnings. The earnings and guidance would provide an impetus for X to jump 30%.

United States Steel reaching oversold territory. $X, $AA, $BAC, $MU

United States Steel has experienced extreme sell off over the past 10 trading days. The stock is already at an oversold state. However, this stock will be heavily affected by STEEL DYNAMICS result which will be released after market on Monday, and AKS results, released on Tuesday Pre-market.

Good earnings by these 2 steel companies would allow a short covering. In Aussie trading, mining stocks opened very low, RIO Tinto was 2% down, but investors are taking advantage of this sale to buy in.

Other attractive stocks now are Alcoa Inc, Bank of America and Micron Technology.