Technical View: Schnitzer Steel breaking out, levels to watch
The shares hit a new 52-week high in trading today, ahead of earnings tomorrow. When price moved above the $34 area a few days following Q1 guidance on December 19 of last year, it took out resistance going back to May 2012. If news and outlook continues to be strongly bullish, this could signal the start of a much larger technical move higher. Resistance levels to watch above the current price of $37.17 are at the $38.50 area, the $40 area, $41.49, and $43.65. There is a large short-base still in the shares as of the last available report, with 8.8% of the trading float short. This could add to buy-to-cover demand on a positive surprise. If the news is a negative surprise, the first significant support level is at the $34 breakout zone. A move below $34 would end the technical breakout, with next supports to watch as potential downside objectives at $32.71, $31.15, and the $30 area.