Vodafone Looks Like It Will Continue Its Bullish Trend in 2018

 | Jan 02, 2018 | 3:21 PM EST
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Vodafone Group  (VOD) looks like it will continue its bullish trend. Prices bottomed in late 2016 and VOD looks like it's in its second advance from the bottom. Let's check the latest charts and indicators to see how far this bull move can carry in the weeks and months ahead.

In this daily bar chart of VOD, below, we can see that prices made a strong mark-up in the first half of the year followed by a five to six month consolidation phase. As the week starts the new year we can see that prices are firmly above the rising 50-day and bullish 200-day moving averages. A bullish golden cross of these averages happened in late May and in hindsight proved to be a profitable signal.

The On-Balance-Volume (OBV) line made a strong four-month climb from February to confirm the price gains. The OBV line was neutral from June to October as prices consolidated but it has started firming again and signals more aggressive buying. The trend-following Moving Average Convergence Divergence (MACD) oscillator turned but above the zero line in October for a fresh outright go long signal.

In this weekly bar chart of VOD, below, we can see a two year downtrend before prices reversed to the upside. VOD is trading above the rising 40-week moving average line and it looks like the weakness in October was a test of the line. The weekly OBV line is bullish and shows a new high for the move up. The weekly MACD oscillator is pointed up in a bullish mode.

In this Point and Figure chart of VOD, below, we can see a longer-term uptrend from 2008-2009. A trade at $35 will be a major upside breakout and open the way for a longer-term price target of $50.

Bottom line: Aggressive traders could long VOD or add to longs at the market or on minor weakness. A close above $35 is another place to add to longs. Risk below $30.50 and $50 is our longer-term price target.

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