I look at the weekly and monthly charts in CLF and it looks like death! Maybe another 40% of downside. But as a lower time frame trader I see a long set up. I tweeted earlier today that CLF looked to be bottoming as it was being supported at 24.50. That was a good spot to initiate a small position.

I like the idea of picking some up there tomorrow if the price area is tested again with a stop around 24.35. If it trades above 24.75 and consolidates above that price for 25+ minutes I think it is time to put on a full position and look for a move to the Target Zone highlighted in the chart below.

Steven Spencer is the co-founder of SMB Capital and SMB University and has traded professionally for 16 years. His email is [email protected].

No relevant positions