Bullish Humana Stock Should Keep 'HUM'ming Along

 | Jan 31, 2018 | 3:05 PM EST
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Humana Inc. (HUM) has rallied $100 per share in the past 12 months. Prices experienced a small "hiccup" Tuesday but overall the charts and indicators are still bullish. Let's review our favorite charts to come up with a strategy.

In this daily bar chart of HUM, below, we can see an uptrend from February to the end of August. From September to the end of December HUM traded sideways. A new uptrend got under way from late December. Currently HUM is above the rising 50-day moving average line and the rising 200-day average.

The daily On-Balance-Volume (OBV) line has been rising all year and tells us that the buyers of HUM have been more aggressive than the sellers. The Moving Average Convergence Divergence (MACD) oscillator is well above the zero line but the two moving averages that make up this indicator have begun to narrow towards a possible take profits sell signal.

In this weekly bar chart of HUM, below, we can see that prices are above the rising 40-week moving average line. The weekly OBV line rose from July 2015 to October last year. Since the fall the OBV line has not made a new high but it is also not far from making a new high. The weekly MACD recently crossed to the upside from above the zero line -- a fresh go long signal.

In this Point and Figure chart of HUM, below, we can see the uptrend and a long-term price target of $387-plus. The chart shows a small consolidation area forming but not a top pattern.

Bottom line: HUM could see further sideways price action but eventually prices should work higher. Trade HUM from the long side risking a close below $260 for now.

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