We wrote about Raytheon Co. (RTN) just the other day and I summed things up this way, "Bottom line: RTN looks a little extended right now but with all our indicators on the daily chart and the weekly chart in a bullish alignment, I do not look for much of a dip or correction. RTN could head still higher but traders should raise stop protection to a close below $190." Prices dipped intraday Tuesday but closed near the highs of the day. So far this morning RTN is working higher and could even make a new high close.
In this daily bar chart of RTN, below, we can see a sharp move up in recent sessions. Some stocks that looked like this (below) quickly retreated yesterday. Notice how RTN did decline but only closed slightly lower. Prices are still well above the rising 50-day moving average line. The daily On-Balance-Volume (OBV) line did not dip much yesterday as the volume of selling was not that heavy. The Moving Average Convergence Divergence (MACD) oscillator is made up of two moving averages and these averages have not narrowed on this chart. All good.
I see no warning signs on this weekly bar chart of RTN, below. Prices are not showing a key reversal. Prices are above the rising 40-week moving average line. The weekly OBV line has been rising for two years. The weekly MACD oscillator has crossed to the upside for a fresh outright go long signal.
In this Point and Figure chart, below, we have tweaked the plotting to show a potential longer-term price target of $382.
Bottom line: Defense spending remains a priority with the Trump Administration and the charts of RTN are still bullish. Traders and investors should stay long. Traders might want to have a sell stop below $194, and investors a stop close only below $190. $240 is our next upside price target. Our Point and Figure price objective of $382 will have to wait.