Hexcel Corporation develops, manufactures, and markets structural
materials for use in commercial aerospace, space and defense, and
industrial markets in the United States and internationally. The company
operates through two segments, Composite Materials and Engineered
Products. The Composite Materials segment manufactures and markets
carbon fibers, fabrics and specialty reinforcements, prepregs and other
fiber-reinforced matrix materials, structural adhesives, honeycombs,
molding compounds, tooling materials, polyurethane systems, and
laminates. The Engineered Products segment manufactures and markets
aircraft structures and finished aircraft components, including wing to
body fairings, wing panels, flight deck panels, door liners, helicopter
blades, spars, and tip caps and fittings as well as for certain
industrial applications.
Take a look at the 1-year chart of Hexcel (NYSE: HXL) below with added notations:
After rallying nicely into 2015, HXL started trading sideways over
the following 4 months. While in the sideways move, the stock formed a
common pattern known as a rectangle. A minimum of (2) successful tests
of the support and (2) successful tests of the resistance will give you
the pattern.
HXL’s rectangle pattern formed a resistance at $52 (red) and a $48
support (green). After Monday’s drop, the stock is now back inside that
range.
The Tale of the Tape: HXL is trading back inside its
trading range. The possible long positions on the stock would be either
on a pullback to $48 or on a breakout above $52. The ideal short
opportunity would be on a break below $48.
