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I will take this week a closer look at the Material & Construction sector ( I will comment every week a new sector, so email me if you have a favorite sector to highlight). The sector performed extremely well between 2004 and 2005. It topped out last April and started a deep correction that found support at the 38,2% Fibonacci retracement ( the chart showed below is a weekly chart).

The sector bounced off that level and started an oversold rally that is still in act right now. But a continuation of this rally seems to be unlikely. The chart shows a lot of overhead resistance and for this reason I am not bullish here. Despite my neutral view of the sector, there are some interesting plays, that you could put on your watchlist for the weeks ahead:
Cemex S.A.B. de C.V.(CX) broke out of a base pattern in the first week of October. The stock is now congesting about that level and a pullback to support in the next days could be the best scenario possible to buy this stock.

Imperial Chemical Industries plc(ICI) is moving sideways just below the highs and could break out soon. The only problem on this stock is the light average volume (Avg Vol 73,000).

The last stock is Quanta Services Inc. (PWR). The stock is the strongest available in my database. It reached new highs last May and after a 4-month pullback the stock re-challenged that level 5 bars ago. PWR is moving sideways since then and could break out to new highs soon.

Chart Courtesy Of: Swing Trading, Technical Analysis, Daily Stock Market Commentary.

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