Toni's Position Trader Newsletter Pick of the Week

The Goodyear Tire & Rubber Company (GT) engages in the development, manufacture, distribution, and sale of tires and related products and services worldwide.

Sector: Consumer Goods
Industry: Rubber and Plastics

GT was one of the market's darlings in late 2006 and into mid-2007. Since then it has been in a corrective mode. It has formed two waves of selling on a monthly time frame into the 20 month simple moving average and has begun to stabilize at that level. I am expecting the upside momentum in GT to increase at this point and will begin to build a position in it with the 20 months sma as support. Notice that volume has recently increased after a period of diminished volume. It has done so with an upside bias, suggesting that the security will continue in that direction. A setup such as the two-wave correction can often begin gradually like GT has done so far and increase on the upside much like a slope of a mountain, so the fact that it did not rapidly bounce off the monthly support and has rounded off at it instead is not a large concern for me.


Stock to Watch:
Long: AZO - Note that AZO is related to GT in that it is also in automotives, although it is technically in the services sector and auto parts industry.


Goodyear Tire & Rubber Co. (GT)