SunCoke Energy Inc (NYSE: SXC)

SunCoke Energy, Inc. operates as an independent producer of coke in the Americas. The company operates through four segments: Domestic Coke, Brazil Coke, India Coke, and Coal Logistics. The company offers metallurgical and thermal coal for use as a raw material in the blast furnace steelmaking process. It also provides coal handling and/or mixing services to steel, coke, electric utility, and coal mining customers.

Take a look at the 1-year chart of SunCoke (NYSE: SXC) below with my added notations:

1-year chart of SunCoke (NYSE: SXC)

Over the past 6 months, SXC has hit the $8.25 mark as resistance on several occasions. In addition, the stock has been climbing a trend line of support (green) since the end of June. Together, these two lines have formed an ascending triangle on SXC. Eventually, the stock will have to break either the $8.25 resistance or the triangle support.

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The Tale of the Tape:: SXC is winding up between two key levels. A long trade could be made at the triangle support or on a break above $8.25. A break below the triangle support would 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!

Good luck!

Christian Tharp, CMT

Follow me on Twitter: @cmtstockcoach