Is the Steel Industry suggesting that a recession is nearing? In my humble opinion, the jury is still out on this one.
This chart from Marketsmith.com takes a look at the patterns of Steel ETF (SLX).
SLX has spent the majority of the past 3-years inside of trading range (1). The persistent decline over the past year has it testing the bottom of this trading range at (2).
The weakness over the past year has it below long-term moving averages as its relative strength rating continues to decline.
If SLX breaks below trading range support at (2), it could join the ranks of the yield curve inversion, suggesting slower economic times are ahead.
Stock and economic bulls want/need for SLX to rally off support at (2).