Saturday, November 14, 2009

Sector Selector: Containers & Packaging

I'm seeing quite a bit of weakness in the Containers & Packaging area. I wanted to highlight one chart, ATR and present you with a download with with other charts in this sector.

Click to make larger/clearer

I like to use the 13/34 exponential moving averages as recommended by John Murphy. This stock is showing significant weakness relative to those moving averages and relative to the broader index. Is it consolidating? Could be along with the broader market. I've no crystal ball. But I'm keeping my peepers and my mind on this group for shorting opportunities.

I was viewing this stock in conjunction with a broader sector view. Each of us must cultivate how we go about looking for opportunities (long/short) in the market. I like to look at sectors and stocks within those sectors. My personal belief (though I've no empirical evidence just my anecdotal!) is that poking about in sectors will give one a feel for what is supporting the broader market indices.

Sectors rise and fall in a syncopated fashion against those broader indices. Accordingly, focusing only on the indices (or even the ETF's) may prevent one from finding some 'action' away from the crowd. Once you hear about the action in the mainstream media, that is after a move has become newsworthy. Newsworthy= stale=higher risk to me.

I prefer to point and flush these out on my own. I've put other charts in this sector in this PDF for your viewing pleasure.

Position: Interested and watching.


Biffermas said...

On your list of packagers BLL, OI, PKG, and PTV look very tired and ready to bonk.

UFPT - with the tight two month consolidation, it’s upside breakout looks weak. I would not short this yet, but am watching wth interest.

Thanks, Leisa

Leisa said...

I think that UFPT would be a nice one to hightlight in a post. Thanks.