Score 7.4 (out of 10): CATERPILLAR sets up for +7% rally in 2 months

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What’s Going On Here?

The recent Ukraine conflict has contributed to surging prices for commodities, particularly given Moscow’s prominence as a mining exporter. This development has also lifted the stocks of companies that facilitate extraction elsewhere, such as Caterpillar.

Why Now?

CATERPILLAR INC has triggered a new technical analysis ‘buy the dip’ signal. During similar occasions, CATERPILLAR INC shares had a median return of +7%, over the following 2 months – based on 10 historical occasions with 8 of those showing positive returns (80%). This buy signal for CATERPILLAR INC received a high score of 7.4 (out of 10). This insight was generated on 2022-January-28 with last price of 220.81.

What’s This Company About?

CATERPILLAR INC is in the Machinery-Constr&Mining business. Based on the last 2 years’ risk/return profile, this asset is seen as Less Risky. ‘Wall Street’ analysts think the stock price will be worth +11.7% (average). Ticker symbol: CAT US.

What’s My Risk / Reward and Time Horizon?

We found 2 months to be the optimal trade horizon, after testing a number of possible alternatives (accuracy of previous returns). Otherwise consider closing out this trade once the target level of 236.19 (+7%) has been reached. Based on CATERPILLAR INC’s recent up and down swings, LongShortBets suggests considering to set a stop loss level for this insight at 215.51 (last price at 220.81), which is equivalent to a -2.4% decline.

Returns during similar periods:

The chart above shows the previous returns (in %) based on similar setups with the most recent ‘insight’ shown under (1), the second most recent ‘insight’ under (2), etc.

Previous episodes:

2.6% (January-2022), 11.4% (November-2021), -4.1% (August-2021), -13% (June-2021), 4.8% (April-2021), 15.3% (January-2021), 16.4% (October- 2020), 7.7% (August-2020), 17.1% (June-2020), 6.2% (April-2020).

Historical Chart:

Summary:

NameCATERPILLAR INC
ViewUp
Star (1 to 10)7.4
Target7%
Time2 months
Hit Rate80%

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