Abbott Labs Is Set to Go Substantially Higher

 | Mar 20, 2017 | 9:37 AM EDT
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Abbott Laboratories  (ABT) has a bullish chart pattern on both a daily and weekly timeframe. Prices are ready for an upside breakout at any moment, in my opinion. Do your fundamental research now because the charts are ready.

In this daily bar chart of ABT, below, going back 12 months we can see a broad sideways trading range with a slight upward bent -- the November/December lows are slightly higher than the May/June lows. For much of the past year prices have been swinging up and down around the 50-day and 200-day moving averages but a much strong response can be seen just this year. In January, prices rallied to close above the now rising 50-day simple moving average line. By the end of January prices were above the 200-day average and its slope turned positive in February. February also brings a bullish golden cross as the 50-day average moves above the slower to react 200-day average. 

Beneath the surface and below the price chart is the On-Balance-Volume (OBV) line, which turns up in December before prices turn up -- a good sign. The trend-following Moving Average Convergence Divergence (MACD) oscillator moves above the zero line in January for an outright go long signal but recently weakened with a take profits signal.

In the weekly chart of ABT, below, going back three years we can see a possible triple or quadruple bottom on ABT from late 2015. Prices are above the now rising 40-week moving average line. The weekly OBV line turned up in December and the weekly MACD oscillator turned bullish in February. This chart clearly shows that a close above $46 should be bought.

In this Point and Figure chart, below, we can see the bullish consolidation of the past two years. An entry on this chart at $46 will be a breakout from a double top and give us a potential price target of $59.

Bottom line: Traders and investors could go long ABT on a move above $46 risking below $43.50 and looking for $59 in the months ahead.

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