PPG (Long)...

PPG reported earnings last week. Look at that nice, high-volume breakout above multi-month resistance around $46 (the purple line). I would not be chasing this stock up here around $50, as I expect it to pull back in the short term. Ideally, both of those gap-ups get filled. If the optimism about the economy turning keeps going, stocks like PPG are the place to be. Chemical companies like PPG are early cyclical companies, meaning they tend to perform strongest early in an economic cycle or recovery. The economic cycle is a topic for future discussion, and a very important one at that because it is essentially the mutual fund manager's playbook, but for now this is sufficient. Anyway, on a pullback, PPG is a buy, but I would not be chasing up here. If it falls back into that multi-month congestion, that means we're early and we'll take the minor stop loss so we can move into something a bit juicier.



Position: none, but a former resident of Pittsburgh, PA