PVH's 2 Year Uptrend Continues: Buy Here, Raise Stop Protection

 | Feb 07, 2018 | 11:36 AM EST
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We last checked in with PVH Corp. (PVH)  in late November where I wrote, "PVH broke out on the upside from a 3 1/2-month consolidation, but prices now look like they can pull back and retest the breakout around $130." Prices dipped near $130 in December and have rallied towards $158 this year. We still have a Point and Figure price target of $175 - can we still get there? Let's review the charts and indicators before answering.

In this daily bar chart of PVH, below, we can see that during the recent heightened volatility that PVH only declined to the rising 50-day moving average line. Prices just touched the line and rebounded quickly. PVH is, obviously, above the rising 200-day line which intersects down below $125.

The On-Balance-Volume (OBV) line has been climbing the past year and last month made a new high to confirm the new price highs. The Moving Average Convergence Divergence (MACD) oscillator has been above the zero line all year telling us the trend has been positive. Recently the MACD oscillator crossed to the downside for a take profits sell signal. If PVH makes new highs the oscillator is likely to cross back to a buy signal.

In this weekly bar chart of PVH, below, we can see that PVH has been rallying since early 2016. Prices have been above the rising 40-week moving average line for months. The weekly OBV line has been trending higher to confirm the two-year advance. The trend-following MACD oscillator in the lower panel has been in a bullish mode above the zero line since May.

In this Point and Figure chart of PVH, below, we get another perspective on the rally. A trade up at $158 would be a fresh upside breakout. A potential price target of $171 is indicated.

Bottom line: The price of PVH has been going up for two years and I see no signs of selling/distribution. I would continue to hold longs from lower levels and aggressive traders could buy more at current levels and on strength above $158. Sell stops should be raised to a close below $140 or just below the recent pullback low. The $170 is our next upside price objective.

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