Raytheon Co. (RTN) was reviewed at the end of January and I summed up my thinking this way: "...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."
Action Alerts PLUS holding RTN has made some big moves over the past two months and this could affect the indicators - let's check.
In this updated daily bar chart of RTN, below, we can see that prices did not break below $190 so investors should still be long. Traders might also be long depending on where their stop was placed. I know that many people involved in the markets today do not even enter sell stops so we may well assume that everyone is still on board.
RTN has been testing the rising 50-day moving average line the past two weeks and each dip looks like it has been bought. Why? First, we have not closed below the line. Second, the daily On-Balance-Volume (OBV) line has continued higher signaling that buyers of RTN have been more aggressive.
The Moving Average Convergence Divergence (MACD) oscillator gave a take profits sell signal in early March but it has not declined below the zero line so the trend is still positive.
In this weekly bar chart of RTN, below, we can see a strong uptrend for more than two years. RTN has stayed above the rising 40-week moving average line since October 2015. One simple indicator would have kept you long the entire time. No one said technical analysis has to be complicated.
Prices are a little extended over the average line when we look back at the history of trading. The weekly OBV line has leveled off the past three months and suggests that buyers and sellers of RTN are in balance. The weekly MACD oscillator is poised to signal a take profits sell signal or a sell in an uptrend.
In this Point and Figure chart of RTN, below, we can see a strong uptrend with a number of consolidation patterns along the way. Prices have exceeded our last upside price target but that is not the same as seeing a distribution pattern. A rally to $224.71 is needed to refresh the uptrend. It is hard to tell what price on the downside might signal weakness.
Bottom line: The daily bar chart (first chart, above) of RTN could be making an ascending triangle pattern with the top of the pattern along $220 and higher lows seen in February and March. A strong breakout above $223 on heavy volume is needed to complete the pattern. Risk a close below $205 now.