Aerospace & Defense Stocks are strong here. $ITA – April 18, 2023

by DAN
This is Scott with your Chart of the Day. I want to take a look at the iShares Dow Jones US Aerospace & Defense Index Fund ( BATS: ITA ). For anyone new to trading this is an ETF, Exchange-Traded Fund that is a basket of aerospace and defense names.

I am zoomed out here so you can see all the way back to before the pandemic crash. You can see this high here around 120.00 is pretty close to where we are now. We are only about 3.5 percent from the pre-pandemic high. And so ITA ( BATS: ITA ) has been able to recover a lot of this move, and it has my attention because it is close to those highs.

Typically, you want to pay attention to stocks and index funds that are near the highs because there is less resistance overhead. There is selling overhead because everyone who is in that vehicle, whatever the trading vehicle might be, is in profit. And so I am paying attention to ITA ( BATS: ITA ) for a potential retest of the highs at around 120.00.

I like the fact that this is already pretty constructive as it is. It is around the key moving averages. We have clear support around the 50-day and today’s breakout move, which is, again, near some recent highs, is coming on a nice pickup in volume. Now, I think a lot of that has to do with LMT ( NYSE: LMT ), Lockheed Martin ( NYSE: LMT ), with their earnings. You can see, this had a nice big gap and go and it held the gap.

But that brings me back to ITA ( BATS: ITA ) as a way to play the entire sector. And so what I want to do on ITA ( BATS: ITA ) is, set an alert, just at this recent high cluster at around 118.00. Because my assumption is, if we can get above and stay above 118.00, then we are probably going back up to 120.00 to test this high from back here in 2020.

And so this is definitely a sector that I think we need to keep on our watch list and that is what we are going to do over at StockMarketMentor.com. I wanted to share this chart with you so that you can take advantage of this if this does break out and make a new high.

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