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Cytec Industries Inc., a specialty chemicals and materials company, engages in developing, manufacturing, and selling chemical products primarily for aerospace composites, structural adhesives, automotive and industrial coatings, electronics, inks, mining, and plastics markets. It operates in four segments: Engineered Materials, In-Process Separation, Additive Technologies, and Coating Resins. The Engineered Materials segment offers aerospace-qualified and industrial-grade prepregs, resin infusion systems, structural/surfacing adhesives, formulated resins, and carbon fiber reinforcements. The In-Process Separation segment provides mining chemicals, including flotation promoters, collectors, frothers, dispersants and depressants, solvent extractants, flocculants, filter and dewatering aids, antiscalants, and defoamers; and phosphines comprising flame retardants, catalyst ligands, high purity phosphine gas, and biocides. The Additive Technologies segment offers polymer additives, such as ultraviolet light stabilizers and absorbers, high performance antioxidants, and antistatic agents. The Coating Resins segment provides specialty coating resins comprising coating additives and waterborne resins; conventional and ultraviolet curable powder coating resins.
To review Cytec’s stock, please take a look at the 1-year chart of CYT (Cytec Industries, Inc.) below with my added notations:
First, CYT has formed a clear resistance at $70 (red), which would also be a 52-week high breakout if the stock could manage to break above it. In addition, the stock is climbing a potential trendline support level (blue). These two levels combined have CYT sandwiched within an ascending triangle, assuming the trendline is valid. The stock will eventually have to break one of those two levels.
The Tale of the Tape: CYT has an up trending support and a 52-week resistance level to watch. A long trade could be made on a breakout above the $70 resistance. A break below the up trending support could be an opportunity to enter a short trade.
Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.
No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!
Christian Tharp, CMT