Parker-Hannifin (PH) has shown improvement from a January 2016 low, but is running into overhead resistance. It is not showing a significant expansion of volume on the advance to get too optimistic.
In recent weeks, Parker-Hannifin has rallied to go over the now flat 50-day moving average. Longer term, the stock is still below the declining 200-day average. The On Balance Volume (OBV) line has inched up a little, but is not really impressive. Volume is the weapon of the bull and here the bull seems to be lacking.
Additionally, the lower lows in price in December and January did not generate a bullish divergence from the momentum study. It is not necessary to have a bullish divergence to have a bottom, but it sure helps.
The longer-term chart of Parker-Hannifin, above, points to further weakness. The chart shows the large top formation with a number of unsuccessful attempts to break above the $130-plus level. Prices eventually declined below the 2014 low and remain below the declining 40-week moving average.
Looking closely at the OBV line, it looks like it has been going down on this timeframe for nearly two years, a lot of long liquidation. Although there is a bullish divergence on this time frame between the price lows in September and January, it isn't all that impressive without a strongly rising OBV line.
Conclusion? Parker Hannifin could try to test the resistance in the $105 to $110 area, but it doesn't look like it will overcome it. But, we'll keep an open mind if volume expanses significantly.