Will Wabtec Corp breakout?

Our stock screener has spotted Wabtec Corp (NYSE:WAB) as a possible breakout candidate. A technical breakout setup pattern occurs when the stock is consolidating after a nice uptrend. Whether the actual breakout occurs remains to be seen of course, but it may be interesting to keep an eye on NYSE:WAB.

Zooming in on the technicals.

ChartMill assigns a Technical Rating to every stock. This score ranges from 0 to 10 and is updated daily. The score is determined by evaluating multiple technical indicators and properties.

We assign a technical rating of 10 out of 10 to WAB. This is due to a consistent performance in both the short and longer term time frames. Also compared to the overall market, WAB is showing a nice and steady performance.

• Both the short term and long term trends are positive. This is a very positive sign.
• Looking at the yearly performance, WAB did better than 70% of all other stocks. On top of that, WAB also shows a nice and consistent pattern of rising prices.
• WAB is currently trading near its 52 week high, which is a good sign. The S&P500 Index however is also trading near new highs, which makes the performance in line with the market.
• In the last month WAB has a been trading in the 85.13 - 91.12 range, which is quite wide. It is currently trading near the high of this range.
• WAB is part of the Machinery industry. There are 144 other stocks in this industry, WAB did better than 61% of them.

How do we evaluate the setup for NYSE:WAB?

Besides the Technical Rating, ChartMill also assign a Setup Rating to every stock. This setup score also ranges from 0 to 10 and determines to which extend the stock is consolidating. This is achieved by evaluating multiple short term technical indicators. NYSE:WAB currently has a 9 as setup rating:

Besides having an excellent technical rating, WAB also presents a decent setup pattern. Prices have been consolidating lately and the volatility has been reduced. There is a resistance zone just above the current price starting at 90.34. Right above this resistance zone may be a good entry point. There is a support zone below the current price at 89.58, a stop order could be placed below this zone. Very recently a Pocket Pivot signal was observed. This is another positive sign.

Trading breakout setups.

For a potential trade one would typically wait until the stock breaks out of the consolidation zone to enter the stock and it could be sold again for a loss when it would fall back below the zone.

Of course, there are many ways to trade or not trade NYSE:WAB and this article should in no way be interpreted as trading advice. The article is purely based on an automated technical analysis and just points out the technical observations. Always make your own analysis and trade at your own responsibility.

More breakout setups can be found in our Breakout analyzer.