Nucor (NUE) Materials Play for 2025NYSE:NUE announced earnings this morning. The subsequent opening price action triggered a Spike Alert on the opening 30 minute bar which brought the stock to my attention.
This spike was generated by the Earnings opening price action. Earnings beat estimates and the stock rallied. However, where the spike breached... and more importantly held... was what interests me.
Price Action Support
The combined supports of:
The 50% Retracement of the trend from January 3rd to January 21st
The Volume Profile Point of Control (POC) for the Trend
...being tested and held are a great sign that price has found support and is respecting it.
To further my analysis of the stock for a long term hold I graduated up to the Weekly Timeframe.
The same two confluences of 50% Retracement and Volume Profile POC have come together and prior to today's Earnings they held as Support in late December 2024.
Finally, we can move up to the Monthly and see the Ichimoku Cloud holding as a potential Ichimoku Cloud pullback.
Fundamentals
NYSE:NUE is a company that has been around a long time. It is a Materials Company (Steel, mostly) with a long price history to look back on. Doing so I noticed that the company's price trends were highly cyclical covering many years. The current pullback that price is within represents a close to -40% discount from the All Time High. The stock's performance will likely depend on economic demand in the coming years.
Trade Management
For this Entry to be valid it should first hold today's Earning Spike low and continue to rally. In the longer term price should not violate the low set during the month of January 2025. Holding both would be great and be exactly as I plan this trade. Violating either or both means the Support is wrong.
Market Thoughts
As a final thought; a lot of investors ask me questions about whatever is "HOT" and in the news. Clearly, this week (and for many weeks) that has been everything tech. You will not find me very interested in chasing these stocks. Not until they have had huge (-50%, -60%) drawdowns. These plays (like Nucor) are the ones I try to find to start my year and then hold them for long to come.
Trade wisely.
