Author

Bruce Kamich

Browsing

We continue to look for weaker prices heading into the year-end.

Stocks quotes in this article: TSLA

The ‘Magnificent Seven” – are a collection of seven companies that have become household names during the pandemic, Jim Cramer said, and as long as we’re waiting on a vaccine, these stocks will continue to rise.

There’s Tesla (TSLA) , a perennial cult favorite. Cramer told viewers of Mad Money Monday evening that shareholders of Tesla are convinced the company will grow into its sky-high valuation and quarterly earnings will not dissuade them.

Let’s check out the charts of TSLA ahead of earnings that are expected after the close on Wednesday.

In this daily bar chart of TSLA, below, we can see that prices have been stalled since early September. Prices are pointed down on a short-term basis and could test the rising 50-day moving average line. Trading volume has been declining the past two months.

The On-Balance-Volume (OBV) line has been in an uptrend the past 12 months but now looks like it has made a small high.

The Moving Average Convergence Divergence (MACD) oscillator peaked in early September and has been declining towards the zero line.

In this weekly bar chart of TSLA, below, we can see that prices are up some eight-fold from their base pattern around $60. Prices are above the rising 40-week moving average line. Actually, prices are extended above the 40-week line.

The weekly OBV line has been rising this year but may be stalled in the past two months or so.

The MACD oscillator has narrowed significantly in recent weeks and is now close to a downside crossover and take profits sell signal.

In this daily Point and Figure chart of TSLA, below, we can see that the software is projecting a possible upside price target in the $580 area but we can also see that a decline to the $404-$400 area could weaken the chart.

Bottom line strategy: TSLA has been stalled in chart traffic the past two months. The major trend is up but our indicators have been weakening and that tells us that some traders and investors are subtly changing their positions. We continue to look for weaker prices heading into the year-end.

Author: Bruce Kamich

Source: Real Money: Tesla’s Indicators Continue to Show Signs of Weakness

Here’s where ABT could be headed next.

Stocks quotes in this article: ABT

Shares of Abbott Laboratories (ABT) are trading higher Thursday in reaction to news that the FDA granted emergency use authorization for the company’s 15-minute Covid-19 test that will be priced at just $5.

Let’s check out the charts for the next fifteen minutes and see what sort of results we get.

In the daily bar chart of ABT, below, we can see that the shares made a dramatic “V” bottom in March. By late April prices had soared to new highs. After a May/June correction prices began to climb again. ABT is trading above the rising 50-day moving average line and above the rising 200-day moving average line.

The On-Balance-Volume (OBV) line shows gains from late March to tell us that buyers of ABT have been more aggressive. This confirms and supports the bull story.

The Moving Average Convergence Divergence (MACD) oscillator has been above the zero line since the middle of April and looks poised to turn higher.

In the weekly bar chart of ABT, below, we can see a durable uptrend over the past three years. Prices are above the rising 40-week moving average line. Trading volume has been active.

The weekly OBV line has been pointed up and the MACD oscillator shows a bullish alignment above the zero line.

In this daily Point and Figure chart of ABT, below, we can see an upside price target in the $110-$111 area, which the shares could reach Thursday.

In this weekly Point and Figure chart of ABT, below, we can see a potential upside price target in the $134 area.

Bottom-line strategy: Existing longs should set their sights on the $134 area as the next price target. Raise sell stops to a close below $97.

Author: Bruce Kamich

Source: Real Money: Abbott Labs Soars to New Heights: The Stock’s Next Technical Targets

Here’s how to play the stock after a disappointing showing at the Golden Globes.

In a break from football, TV viewers got to watch Sunday’s Golden Globe ceremony. Despite 17 nominations, the most of any single studio, Netflix (NFLX) only took home two trophies (and less after parties). Let’s check in on the charts and indicators on NFLX to see if they can tell us anything new.

In this daily bar chart of NFLX, below, we can see that prices make a low in September. The shares rallied to the bottom end of the gap down created back in July. Prices then rallied above the 50-day moving average line in early November and the slope of this indicator turned upward. The slower-to-react 200-day moving average line was not crossed on the upside until December and its slope is flattening.

The trading volume has been heavy since September and the daily On-Balance-Volume (OBV) line began a rise in late September telling us that buyers of NFLX had turned more aggressive. The Moving Average Convergence Divergence (MACD) oscillator is bullish after a cross of the zero line in November.

In the weekly bar chart of NFLX, below, we can see that the big picture is a large sideways trading range for the past two years. Prices have firmed back above the bottoming 40-week moving average line.

The weekly OBV line has improved from the middle of October telling us that buyers on this longer time frame have turned more aggressive.

The trend-following MACD oscillator crossed to the upside in early November for a cover shorts buy signal and now is just below the zero line and an outright go long signal.

In this weekly Point and Figure chart of NFLX, below, we can see that the software has projected a potential upside price target of $413.

Bottom-line strategy: NFLX could pullback Monday with weakness in the broader market but support should be seen just below $320. Traders could consider going long on weakness if they can risk a close below $300. The $415 area is our 2020 price target.

Author: Bruce Kamich

Source: Real Money: Take a Bow: Netflix Has Made Base Pattern That Can Support Much Higher Prices

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?

The retailer’s shares are jumping after it hired a former Target exec as its CEO, but whether the rise constitutes a breakout gap is unclear at this point.

Bed Bath & Beyond Inc. (BBBY) is the Stock of the Day here at Real Money after the retailer announced the hiring of Mark Tritton, Target Corp.’s (TGT) chief merchandising officer, for the CEO job and a number of retail analysts have published positive comments. Bed Bath & Beyond’s stock price was up around 18% before Thursday’s opening bell on the news. Will this really improve the chart picture of BBBY or will this be a flash in pan, so to speak? Let’s check out the charts and indicators.

In this daily bar chart of BBBY, below, we can see that the stock price of this retailer has not fared well since early April. Prices have slumped from above $19 to nearly $7 is just a few months. Prices have recovered a little from an August low to trade above the bottoming 50-day moving average line. BBBY is still below the bottoming 200-day moving average line, but a rally to around the $12 here on Thursday will put the stock much closer to this long-term indicator. The On-Balance-Volume (OBV) line has improved from the middle of August and tells us that we are seeing a shift from aggressive selling to aggressive buying. The Moving Average Convergence Divergence (MACD) moved above the zero line in September for an outright go long signal.

In this weekly bar chart of BBBY, below, we can see an improving picture. Prices are still below the 40-week moving average line but the line is starting to bottom. If Thursday’s rally can hold through Friday’s close we could be testing the underside of the 40-week line and maybe close above it. The weekly OBV line shows improvement the past two months and the MAC oscillator has crossed to the upside for a cover shorts buy signal.

In this Point and Figure chart of BBBY, below, we can see a potential upside price target in the $12-$13 area. This target was calculated through Wednesday’s close, so we may have a higher price target later here on Thursday. Meanwhile, this is a good start.

Bottom line strategy: The key question is whether the charts have improved enough to recommend a long position. BBBY is likely to gap higher here on Thursday but I do not currently feel this will be a breakout gap. I suggest prices could soon retreat and retest the $11 area. Traders could then approach the long side of BBBY, risking below $10.

Author: Bruce Kamich

Source: Real Money: Bed Bath & Beyond Shakes Up the Retail Market and the Charts, Too

Ad Blocker Detected!

Advertisements fund this website. Please disable your adblocking software or whitelist our website.
Thank You!