• Chart of the Day: Eaton Corporation (ETN)

    by  • November 28, 2012 1:58 pm • Charts to Watch, Tony Venosa's Chart of the Day • 0 Comments

    Today’s chart is of Eaton Corporation (ETN) which operates as a diversified power management company worldwide. The company provides electrical components and systems for power quality, distribution, and control; hydraulics components, systems, and services for industrial and mobile equipment; aerospace fuel, hydraulics, and pneumatic systems for commercial and military use; and truck and automotive drivetrain and powertrain systems for performance, fuel economy, and safety.

    Ticker:  Eaton Corporation (ETN)

    Strategy:  Long Trade (Longer-Term)

    What I Am Looking At:

    • Up nearly 250 percent since 2009 bottom
    • Monthly chart showing breakout of multi-year consolidation pattern
    • Showing relative strength as shares are up nearly 19 percent year-to-date
    • Recently received clearance for pending acquisition of Cooper Industries (CBE)
    • Short interest has increased a whopping 600 percent since May of this year as shares move close to 52-week highs
    • 14 percent of the float is sold short
    • Over 10 days for shorts to cover
    • 50-day buy-to-open put/call ratio stands at 1.36, ranking in the 90th percentile of readings taken during the past year, indicating a strong preference for put buying


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    Tony Venosa, CMT is a Senior Options Strategist and works on the trading desk at Schaeffer’s Investment Research. He joined Schaeffer’s in 2010. He has worked in the finance industry for over 15 years. He began his career as a trading assistant in Chicago on the floor of the Chicago Mercantile Exchange. He later moved upstairs and worked as a commodities broker on both the retail and hedging side. He left the brokerage industry to begin his trading career as a proprietary equities trader at a Chicago firm. In 2000, Tony moved backed to his hometown and continued trading his personal account. He later went on to earn his Chartered Market Technician designation. He earned a B.S. in Finance from Miami University. Tony’s main focus is short-term directional option trading.


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