Stocks quotes in this article: CAT
The stock price of Caterpillar (CAT) has been weak since it made a peak in late 2017 around $170. Prices have declined to a low near $110 and are now showing signs that we could see an improvement into year end.
In this daily bar chart of CAT, below, we can see a sideways to lower trading range market for CAT the past 12 months. The price action and indicators started to show a change from June. Prices made a low in early June and a lower low in late August.
The daily On-Balance-Volume (OBV) line did not make a matching lower low in August and actually made a higher low creating a bullish divergence.
The Moving Average Convergence Divergence (MACD) oscillator made equal lows in June and August despite prices making lower lows. This indicator is now crossing above the zero line for an outright go long signal.
In this weekly bar chart of CAT, below, we can see the stock’s long decline but we can also see some subtle improvement.
The weekly OBV line is up from its late 2018 low. Prices are testing the bottoming 40-week moving average line and the weekly MACD oscillator is moving back towards the underside of the zero line. Not table pounding bullish but certainly not bearish.
Author: Bruce Kamich
Source: Real Money: Is Caterpillar’s Long Decline Coming to an End?