Lockheed Martin... Time to move?
With tensions rising in the Middle East and the gaining of military activity here in the United States, it could be assumed that the government spending to grow the defense will mostly be seen by large defense firms. Specifically, we will be looking at 
LMT but that doesn't rule out any other defense contractors from this trade ( 
NOC , 
HON, 
RTX , 
BA , 
GD ). Firstly, let's examine the charts before reviewing anything fundamental from the company.
This is the 4h chart looking back into late-mid January
Simply put, this is just two of many possible paths that theLMT price action could take. However, these two should be the most expected especially considering its violent downtrend that appears to be "cooling" and not "consolidating". It also appears that LMT price action likes to reclaim any Fair Value Gap that it creates quite quickly as of recent trading terms. The good news is that two large FVG's have been created by a rather lackluster earnings report.
Now, as for a fundamental analysis POV, we can firstly examine the defense industry's cyclical movement throughout the years. This means that the industry is facing booms and busts. So lets see what the 1 week chart has to say about that...
With the chart shown above, you're probably thinking that a quick rebound seems unlikely as the other "BUST" sequences seem to last longer than the "BOOM" sequences. To this I would agree, however being first (or being early) is something I can settle for as there is no possible way to buy the exact bottom penny. When prompted with this dilemma of timing, think back to the Margin Call famous quote...
"There are only three ways to make a living in this business: be first ; be smarter; or cheat... it sure is a hell of a lot easier to just be first."
LMT but that doesn't rule out any other defense contractors from this trade ( NOC , HON, RTX , BA , GD ). Firstly, let's examine the charts before reviewing anything fundamental from the company.This is the 4h chart looking back into late-mid January
Simply put, this is just two of many possible paths that the
LMT price action could take. However, these two should be the most expected especially considering its violent downtrend that appears to be "cooling" and not "consolidating". It also appears that LMT price action likes to reclaim any Fair Value Gap that it creates quite quickly as of recent trading terms. The good news is that two large FVG's have been created by a rather lackluster earnings report. Now, as for a fundamental analysis POV, we can firstly examine the defense industry's cyclical movement throughout the years. This means that the industry is facing booms and busts. So lets see what the 1 week chart has to say about that...
With the chart shown above, you're probably thinking that a quick rebound seems unlikely as the other "BUST" sequences seem to last longer than the "BOOM" sequences. To this I would agree, however being first (or being early) is something I can settle for as there is no possible way to buy the exact bottom penny. When prompted with this dilemma of timing, think back to the Margin Call famous quote...
"There are only three ways to make a living in this business: be first ; be smarter; or cheat... it sure is a hell of a lot easier to just be first."
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.