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The Dow Industrials made impressive gains on Wednesday and the strongest Dow stock was Caterpillar (CAT), which is also the best-performing Dow stock for the year, up over 50%. The chart also features the starc+ and starc- bands, which can be used to determine high- and low-risk times to buy or sell, but not a market’s direction. For more on using starc bands, sign up for this week’s Trading Lesson. One of the weakest Dow stocks is Cisco Systems (CSCO), which is down 19%. CSCO is now testing both the 61.8% support and the starc- band. It is surprising to note that Caterpillar's net profit margin is just over 5%, while Cisco's is a lofty 19%.
Tom Aspray, professional trader and analyst, serves as video content editor for MoneyShow.com. The views expressed here are his own.
