Can Defense Industry Giants Turn Global Tensions into SustainablIn a fascinating paradox of modern defense economics, RTX Corporation stands at the epicenter of escalating global security demands while grappling with production constraints that challenge its ability to meet them. With a remarkable $90 billion defense backlog and recent approval for a $744 million missile sale to Denmark, RTX exemplifies how geopolitical tensions are reshaping the aerospace and defense industry landscape. Yet this surge in demand raises profound questions about the sustainability of growth in an industry where production capacity faces inherent limitations.
The company's financial performance tells a compelling story of adaptation and resilience, with its stock attracting increased attention from major analysts and an upward revision of earnings guidance. However, beneath these promising figures lies a more complex narrative: RTX must balance the immediate pressures of global defense requirements against the long-term challenges of production capacity and technological innovation. This delicate equilibrium becomes even more critical as the company serves not just one nation's defense needs, but those of at least 14 allied nations simultaneously.
What emerges is a thought-provoking case study in strategic industrial scaling: How can defense manufacturers like RTX transform short-term geopolitical pressures into sustainable long-term growth? The answer may lie in the company's diversified approach, combining traditional defense contracts with innovative aerospace solutions, while navigating the intricate balance between immediate market demands and long-term strategic planning. This scenario challenges our traditional understanding of defense industry dynamics and forces us to reconsider how global security needs might reshape industrial capacity in the decades to come.
RTX
Nasdaq & RTX Charts Suggest Promising Growth AheadNASDAQ
After a powerful uptrend, the stock encountered a significant resistance around the 72 level and plummeted sharply thereafter.
Finding stability near the 47 level, the price surged within a Rising Wedge formation.
Typically, following the appearance of this pattern, a decline occurs post-breakout. This scenario unfolded exactly as expected.
Subsequently, the stock price consolidated and established an Inverted Head & Shoulders pattern, signaling a potential reversal in trend.
With two successive breakouts, the stock is currently advancing with strong volume backing.
RTX
We have observed a period of price consolidation within a Symmetrical Triangle pattern in the past.
After the breakout, there was a noticeable price surge, propelling the stock to reach its previous all-time high.
However, the stock faced a significant rejection at that level, leading to another consolidation phase and the formation of a symmetrical triangle pattern.
Once the pattern broke down, the price dropped back to its previous support zone.
Since then, the stock has been steadily moving upwards and recently experienced a strong breakout, surpassing its previous resistance level.
At present, the stock is trading at a new all-time high and is anticipated to continue moving even higher.
Raytheon's Defense Division Shines in Q1 a Deep DiveRaytheon Corporation's Q1 2024 earnings reveal impressive growth driven by its defense division, which achieved $6.6 billion in sales and contributed significantly to a $202 billion backlog. Key highlights include major defense system sales to Germany and Ukraine. Despite overall growth, civilian divisions like Collins Aerospace and Pratt & Whitney also performed well but experienced declining profit margins. Raytheon's innovative commercial satellite imagers, launched as part of Maxar's WorldView Legion, promise advanced imaging capabilities for various sectors. The article concludes with a bullish recommendation on Raytheon stock, suggesting long positions with entry at $102.59 targets ranging from $105.93 to $119.00, and a stop-loss at $93.01.
RTX a defense contractor large cap LONGRTX has earnings on April 23rd. It has been on a good trend higher since the last earnings. The
Russian war means US defense contractors will be in a growth mode for the intermediate
future. Depleted stores of weapons systems need to be replenished. Pieces and parts are
needed for damaged systems in need of maintenance. I see RTX and others such as GD and
LMT as good long-term trades or investments. Smaller companies in the areas of robotics and
drones may be worth a look. RTX is at its all-time high but it seems much higher is in its future.
RTX falls on good earnings and defense budget issuesRTX is part of the boom defense sector thriving because of back orders created by
the Russian war against Ukraine. No matter good earnings it fell this week because
of the defense budget debate in Congress. No matter good intents to rein in the
defend spending escalation and spend in other areas such as social and infrastructure,
Russia has made the world more dangerous and national security of the US and its allies
trumps most spending except perhaps insterest on the national debt and paying the
holders of Treasuries. RTX dropped more than 10% from its tight consolidation range,
I see this dip as an excellent buying opportunity into a leader in the defense sector.
A couple scenarios for RTX swings.🔉Sound on!🔉
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RTX Corporation Options Ahead of EarningsAnalyzing the options chain and the chart patterns of RTX Corporation prior to the earnings report this week,
I would consider purchasing the $80usd strike price Calls with
an expiration date of 2024-1-19,
for a premium of approximately $1.37.
If these options prove to be profitable prior to the earnings release, I would sell at least half of them.
Looking forward to read your opinion about it.
RTX has 2 Short-Levels I would jump inThe orange Fork projects the pull-back potential, which is the Center-Line.
There are 3 short levels I see:
1. The primary is way up in the primary Sellers Zone.
Although this would be the most profitable one, it has a
caveat: Price would by then have broken the Trend Barrier (Dotted slanting Trendline).
2. The secondary Short lies the Secondary Short level, right where the GAP happend. Within this level is also a tiny bunching, where price was not able to overcome.
As for the Oscillators, the MACD and Mansfield are pointing to a Down-Trend. Only the RSI seems to be oversold and is indicating a potential pullback, which is in essence the reason to look for a short. It's supported by the Buyers Zone, where price was picked up by the Bulls.
Definitely a Chart that has it's place in my watch list.
Happy day Tr8dingN3rds §8-)
LMT a defense sector leader setup LONGOn the daily LMT, over the long term is shown to have descended into the support
of the ascending support trendline in what appears to be an ascending wedge.
Confluent with the support trendline is the mean VWAP and the mean band of
the Bollinger Bands. I see an opening for a long trade targeting the resistance
trendline and also the second standard deviation of the anchored VWAP ( red
thick line) Fundamentally, LMT just beat on both the top and bottom lines.
It is in a obvious growth industry with a bakclog of production in the setting
of the Russian Ukraine war and the need for US and NATO to replenish their
stockpiles. This long trade is best for investors content with slow moving blue
chip Dow Jones type stocks or alternatively agile options traders able to leverage
low magnitude up trends. I see about 10% upside and will buy some call options
to exploit this setup.
Is the DFEN dip buyable?I think that the dip is very buyable. Fundamentally, Russia has made the world more
dangerous. Shipments of weapons to Ukraine have depleted US and European stockpiles.
NATO is in a growth mode as proposed by former president Trump some years ago.
While many would like less defense spending and shift it into social spending or
infrastructure or clean technology government funding. the pragmatics are that
national security is generally higher on the priority list. DFEN just dropped below
the high volume area of the volume profile on the 15 minute chart in a VWAP breakdown.
The relative strength lines did a bottom bounce on the indicator. I will exploit this
as a long buying opportunity looking to a modest 5% upside target at minimal risk.
Boeing BA - A Dark HarbourI have never looked at Boeing until today, when I saw some guy posting ideas about it while I was having lunch and I didn't even recognize the ticker, and so I took a look at it, and was surprised to see what I found.
In considering this company, I completely understand that they've had problems with their planes, and big ones. But I have also said that I do not put much weight in the ostensible correlation between fundamentals of a company and price.
So long as the equity is still being maintained by Wall Street's behemoths, price action will remain orderly made and constitute a fractal that is rationally written and contains the combined intelligence of all market participants.
Boeing is really notable on the monthly charts:
Frankly, its bullish price action looked even better than what stuff like AAPL and TSLA printed during this unsustainable Federal Reserve money printer-backed tractor pull to SPX 4,800, and it occurred before COVID, and was accompanied by heavy distribution.
It only finally corrected when COVID hit, and yet it only swept out the '16 low, which led to the original impulse to $450.
Even more taste bud-piquing is the weekly chart:
BA has not had a shred of bullish impulse since March of 2021. More or less, while the entire market went ape-up in a straight line, Boeing has just grinded downwards.
This is highly indicative of significant smart money accumulation.
When the big 2022 correction started, Boeing lost 30% like everyone else, but formed a 24-month double bottom and protected its pre-COVID low with a generous wick and a healthy bounce.
More importantly, there is a gap that appears both on the daily and weekly candles at $330, which is exceptionally notable considering this mid-term range high, printed 18 months ago, wasn't far away at $~279.
I believe that a significant shakeout in the market will come shortly.
VIX - 9x8 = 72
But based on the price action of Boeing, I can't help but feel this is the definition of oversold and that an expectation from short sellers that this is going to turn around and rip south to new lows is going to be met with only one outcome: liquidation.
For other defense contractors like Lockheed Martin and Raytheon, although they have totally different (and much more bullish) price action compared BA, they share the characteristic of severely lagging the overall market in terms of bull impulse.
And these are arguably the most critical companies underpinning the United States and the globalist empire.
This leads me to believe that what lies ahead is a catalyst that will see defense and aerospace stocks go on a _significant_ bull run, providing an unlikely harbour amid an overall market that sees both equities and commodities revisiting (and breaking) pre-COVID market structure.
SPX / ES - Bull Whips and Bear Saws
For Boeing, it's still too expensive to buy, trading above the equilibrium point of this June-forward dealing range.
However, if this thesis that Boeing will go on a tear and not turn around and die is correct, I would want to see it fall to only a certain point and not flirt with the double bottom or the even the June gap lows.
The best buy signal, hands down, will be a dump into the $135 range, accompanied by market makers reverently supporting this area.
If so, you should definitely expect this whole 18 month range below $280 gets cleaned up, and likely in a highly aggressive fashion.
The question is, what serves as a catalyst for the defense and aerospace industry to moon?
There are no pleasant answers.
GD Swing Short SetupBMV:GD
GD has bounced down from resistance of sell order blocks.
Relative Strengh downturn confirms.
This is setup as a swing short with a Reward to Risk of 4.
GD will recover from this reversal as this defense contractor
is in a boom sector, giving the geopolitical /macro overlay.
Also check RTX and LMT.
Raytheon Technologies – Whopping 60% Shorting Opportunity?If you like this idea, please don’t forget to Boost it.
Fundamental Indicators:
Sector – Industrials
US Business Cycle Stage – late cycle, when this sector is neutral
Revenue – consistent growth for the past 5 years, although just 6% average annual rate, the performance in 2022 TTM is considerably slowing down
Profits – although slight increase in 2022TTM, it has still not recovered to pre-pandemic levels
Net margin – 7% which is still below pre-pandemic levels
P/E – the highest historic level with ratio of 31 compared to S&P500 with 21, Industrials sector with 21 and historic average level of 11
Liabilities - debt ratio is at 0.55 which is within the norm, Net Debt/ EBITDA is 2.48 – no problems with debt
Conclusion – although the company is recovering from pandemic but still hasn’t caught up to the previous levels, and given current overpriced valuation, it is very likely to go into correction to get back to the fair value
Technical Analysis (Elliott Waves):
Main scenario of this idea suggests that we are still observing development of the global growth cycle which is currently at the stage of starting corrective wave 4 (see higher timeframe graph)
Since the longest correction in the shape of a Running Triangle that has lasted between 1987 and 1994 completed, this company has enjoyed explosive growth with circa 2100%. However, the whole movement is choppy with a lot of crossings hence likely to be an Ending Diagonal (see guidelines for Ending Diagonals below)
The historic high which was formed in March 2022 was the point of completion of wave 3 in the Ending Diagonal and now we are observing formation of the first leg of wave 4, presumably as a double zigzag. Wave W has completed, wave X is likely to finalise at the price level $97.32
Once completed, there will be another bull run in wave Y with the target range $67-$78 – which may present up to 30% shorting opportunity. However, longer term target is potentially $40 which is whopping 60%
This is a higher timeframe to reflect the full history of Raytheon Technologies Corporation and to provide full wave count:
This is the link to the guidelines for Ending Diagonals
What do you think about Raytheon Technologies Corporation and its short term prospects?
Also let me know if you would like to see other stocks, indices, Forex or Crypto analysed using Elliott Waves. And BOOST this idea if you like it.
Thanks
RTX - potential setupsNYSE:RTX
Raytheon Technologies Corporation , an aerospace and defense company, provides systems and services for the commercial, military, and government customers worldwide.
It operates through four segments: Collins Aerospace Systems, Pratt & Whitney, Raytheon Intelligence & Space, and Raytheon Missiles & Defense.
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👉 1. Price goes ABOVE the selected range on the picture. Long positions to activate.
👉 2. Price goes BELOW the selected range. below. Short positions to activate.
⚠️ Important Notes:
1. Follow your risk management rules.
2. Timeframes: up to 1D
Good luck and profit to all
Raytheon getting nuked. RTXIndeed. A Wave, B Wave as a condensing or constricting triangle, pivot and now just awaiting confirmation.
We are not in the business of getting every prediction right, no one ever does and that is not the aim of the game. The Fibonacci targets are highlighted in purple with invalidation in red. Confirmation level, where relevant, is a pink dotted, finite line. Fibonacci goals, it is prudent to suggest, are nothing more than mere fractally evident and therefore statistically likely levels that the market will go to. Having said that, the market will always do what it wants and always has a mind of its own. Therefore, none of this is financial advice, so do your own research and rely only on your own analysis. Trading is a true one man sport. Good luck out there and stay safe.
Raytheon on the breakout ?A repeated patter on the weekly RTX chart appears to be forming, and technical indicators are set up similarly.
The daily chart is also in alignment as previously. Technical Indicators have just crossed over and suggest a breakout is in order.
About 15% upside potential with upside target at 113.80, about mid-September 2022.
Fundamental and geopolitical alignment should start appearing soon...
Watch this one!
RTX - Channel Breakout Long term chart for RTX showing two distinct channels
A large ascending triangle structure can be seen in the first to lead to the first channel breakout
The second is a inverted H&S structure which will lead to the break out of the second channel breakout which extends back to year 2000
RTX: Underlying StrengthRTX with underlying strength prevalent in its technicals & fundamentals. Leading the industrial sector via geopolitical factors and a favorable balance sheet, RTX continues upwards on a channel trend and on several premises: 1) Buyer responsive price action that has been developing since Q4 of 2021 2) Participants driving auction over KSMAs, 3) Support held at key level of a bullish double bottom formation, PT upgrade to $115 from $105 x maintain of outperform rating via Cowen. Target Price: $110.17 - $125.00 // ATR: 2.29, Beta 1.33