CAT Ignores JPM Research Downgrade

Although Caterpillar Inc. (CAT) was in positive territory this morning in the aftermath of a JPM Research downgrade, I am not rushing into the market to buy the stock just yet, until CAT shows that it can sustain the strength, especially on a closing basis.

In addition, let's notice that CAT remains under intense downside technical pressure from its sharply declining 200-EMA, now at 90.27, and from a series of failed rally attempts, the most recent of which occurred at 88.59 on Nov 6.

My suspicion here is that CAT is attempting to put in a significant low against its Oct 2011 support line (82.80), but thus far has not been able to sustain strength to inflict damage to the dominant downtrend off of the Feb 2012 high.

I will continue to watch from the sidelines for a while longer.