Welcome to the irrational world of short-term trading. When you've got a piece of news, has it been already widely disseminated? If not, is that relevant? If so, does it go against the technicals of the stock or does it confirm them? I shorted CAT after FY08, made some money, then flat, then the stock broke up and I lost marginally more than I won as I decided to close the position. I decided to let it ride up. My mistake was that the stock was clearly oversold on a weekly timeframe so once the FY08 was out and disgested, the stock had to go up.
I believe that CAT is even more overvalued after shooting up by 20% (PE of 13 - 15x on optimistic 2010 estimates) even more so as the consensus for 09 & 10 EPS have been cut down very recently according to Yahoo). The weekly RSI does not look oversold anymore.