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Chart of the Day: Eaton Corporation


Eaton Corp. is up nearly 250% since the 2009 bottom.

Today's chart is of Eaton Corporation (NYSE: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.

Click to enlarge

Click to enlarge

Strategy: Long Trade (Longer-Term)

What I Am Looking At:
  • Up nearly 250% since 2009 bottom
  • Monthly chart showing breakout of multi-year consolidation pattern
  • Showing relative strength as shares are up nearly 19% year-to-date
  • Recently received clearance for pending acquisition of Cooper Industries (CBE)
  • Short interest has increased a whopping 600% 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
This article by Tony Venosa, CMT was originally published on Schaeffer's Investment Research.

Below, find some more great content from Schaeffer's Investment Research:

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Twitter: @schaeffers
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No positions in stocks mentioned.
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