Current trend

RTX Corp. shares have been growing for the fifth session within a long-term upward trend amid geopolitical, financial, and monetary factors.

Since the company specializes in defense developments and the production of dual-use products, uniting such manufacturers as Raytheon Co., Collins Aerospace, and Pratt & Whitney, the increase in global tensions, accompanied by the Russian-Ukrainian and Middle Eastern conflicts, contributes to an increase in demand for the corporation’s products, significantly improving financial performance. Thus, the Q2 net profit amounted to 1.9B dollars, significantly more than the estimates of 1.73B dollars, adjusted earnings per share amounted to 1.41 dollars instead of the expected 1.29 dollars, and sales volume increased by 8.0% to 19.72B dollars YoY. The statistics allow the management to raise the sales forecast from 78.00–79.00B dollars to 78.75–79.50B dollars, and the earnings per share for the year from 5.25–5.40 dollars to 5.35–5.45 dollars, which has a positive effect on the issuer’s securities.

Additional support for the quotes is due to the imminent start of a reduction in interest rates by the US Fed. After the publication of July data on wholesale and consumer inflation, which confirmed the trend towards slowing price growth, the regulator’s officials have fewer and fewer doubts about the need to ease monetary policy, which should begin in September.

Support and resistance

The trading instrument is close to 118.75 (Murrey level [6/8]). Its breakout will allow it to reach the area of ​​121.88 (Murrey level [7/8]) and 125.00 (Murrey level [8/8]). In case of overcoming 112.50 (Murrey level [4/8]), supported by the middle line of Bollinger Bands, a correction to the targets of 106.25 (Murrey level [2/8]) and 103.12 (Murrey level [1/8], the lower line of Bollinger Bands) may follow.

Technical indicators confirm the continuation of the upward trend: Bollinger Bands and Stochastic are directed upward, and the MACD histogram is stable in the positive zone.

Resistance levels: 118.75, 121.88, 125.00.

Support levels: 112.50, 106.25, 103.12.

Trading tips

Long positions may be opened above 118.75, with the targets at 121.88, 125.00, and stop loss 116.35. Implementation period: 5–7 days.

Short positions may be opened below 112.50, with the targets at 106.25, 103.12 and stop loss 116.80.