Raytheon Technologies Corp. - (RTX) - August 8, 2024

SIA Charts’ relative strength rankings help investors identify opportunities in stocks that are outperforming their peers or index benchmarks on a relative basis. Outperformance often reflects improving investor expectations for strong company or sector growth. Raytheon Technologies Corporation (RTX), a prominent player in the defense and aerospace sector, has recently moved into the Favored Green Zone of the SIA S&P 100 Index report. This marks a significant turnaround, as RTX has climbed 8 spots in the past week and 37 spots over the last month, now holding the #12 position. Notably, RTX joins other key players in the sector now in the Favored Green Zone, including GE Aerospace, Lockheed Martin, and General Dynamics, reflecting a strong trend in aerospace and defense. While benefiting from the strong sector performance, recent positive developments, such as securing new contracts and expanding its order book, have further boosted investor confidence in Raytheon specifically. Given that our main metric—relative strength—now has RTX back in the SIA Favored Green Zone, we will turn to the weekly candlestick chart for further insights. Notice the channel that formed between last summer and today (thin black lines), during which the stock broke through the resistance at $100, a key whole number level, which has now become solid support. This impressive performance is highlighted by a 13.73% gain for the month, compared to a -8.45% return for the broader market, and a remarkable 37.38% increase year-to-date, well above the S&P 100 Index’s return of +11.93%. A caveat on the candlestick chart is the declining volume trend as the stock rallied to higher levels, suggesting it might be wise to look for a pullback as a potential entry point along these supportive levels. Should the stock experience a short-term correction, initial long-term support is at $100, with even more significant support at $75.

Turning to the Point and Figure chart, scaled at 2% and using the SIA Report History overlay tool, we observe previous outperformance highlighted in green. The recent column of X’s indicates continued positive performance. Support levels are clear, especially at the whole number $100, with specific levels to note at $107.16 and $99.00, which could provide excellent entry points. Resistance, based on a vertical count, is initially at $135.91, with further resistance at the whole number $150.06. This offers a good risk-reward ratio even from current levels, with an improved outlook if purchases are made along support. Having recently ascended to the Favored Green Zone, Raytheon Technologies (RTX) has demonstrated impressive gains and positive momentum. RTX is now significantly outperforming the market and its peers, warranting close attention from investors and analysts alike. With a perfect SMAX score of 10 out of 10 (a near-term indicator comparing an asset against various asset classes), Raytheon is showing strong short-term performance across all asset classes, even amidst extreme volatility in global stock markets.