Empire Resources (ERS)

Company

"Empire Resources, Inc. is a distributor of value-added, semi-finished aluminum products. Our principal markets include North America, and through our subsidiary, Empire Resources Pacific Ltd., Australia and New Zealand. We currently serve over 200 customers in diverse industries including transportation, automotive, housing, appliances and packaging." (company website)

ERS 3-month stock chart

Buy

Empire Resources has been bouncing along just above $10 for some time now (see sidebar). There are signs that of being ready to break out.

  • Price momentum (PPO) — increasing sharply
  • Trend (ADX) — strengthening rapidly
  • Money flow (CMF) — outflow is slowing down
  • Relative strength (RSI) — gradually increasing
  • Volume — about half what it was three months ago (not a good sign)
ERS 2-month chart ERS 2-month chart

Based on technical analysis, MarketEdge calls ERS a "buy" in a "weak upward trend."

Sell

loss Bottom line
-15%

The empire strikes out! ERS was a risky buy in the first place. The market meltdown at the end of February drove the price below the trend line, and it does not appear to be recovering. Momentum (PPO) has slowed; selling pressure (-DI) is increasing; and relative strength (RSI) is falling. Yesterday's mini-meltdown was the coup de grâce. It hurts, but the only prudent thing to do is take the loss and let it go.