Matson Buyers Will Have to Be Patient

 | Feb 07, 2017 | 9:23 AM EST
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Matson (MATX) is recognized as a shipper in the Pacific region and its chart is easier to work with than Dry Ships (DRYS) , which we looked at earlier. Buyers of MATX will have to be patient and wait for a more developed base pattern before booking passage.

In this one-year daily chart of MATX, above, we can see that the prices of MATX have actually lost some ground in the past 12 months. There have been a number of swift and sharp declines that even with hindsight would have been difficult to anticipate or trade. Currently, MATX is below its declining 50-day and 200-day moving average lines.

The daily On-Balance-Volume (OBV) has been declining the entire time and only made a slight recovery in September and October, when MATX hit its highs. The 12-day momentum study is showing a bullish divergence in November, December and January with higher lows in momentum as prices make lower lows. This divergence may or may not give us much of a winter rally.

In this three-year weekly chart of MATX, above, we can see that prices are just below the declining 40-week moving average line. The weekly OBV line is pointed down and the MACD oscillator is in negative or bearish territory below the zero line.

This Point and Figure chart of MATX, above, is not encouraging, but it does show where prices need to rally to give us a breakout.

Bottom line -- MATX would look better if it can close above $37, but it needs a period of accumulation with a rising OBV line. The chart does not look attractive until we get back to $41 on MATX. Put MATX on your potential watch list, as it is not ready to get on your shopping list.

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