Cigna (CI) has rallied sharply since the election but our charts and indicators suggest further gains are likely in the weeks and months ahead. Let's visit with the charts and indicators so you can see what we mean.
In this daily chart of CI, below, going back twelve months, we can see a bullish alignment of the indicators. CI is back above the rising 50-day moving average line. The 200-day moving average is also rising the past three months and we can see a golden cross of the two averages at the end of December. The daily On-Balance-Volume (OBV) line has been moving higher since the beginning of the new year and recently made a new high ahead of prices. The Moving Average Convergence Divergence (MACD) oscillator has been above the zero line since November and looks like it recently dipped below the zero line and has turned back up for a fresh outright go long signal.
In this weekly chart of CI, below, we can see a saucer-like consolidation or what some might call an upper level or high level base. In the left-hand side of the base prices cross above and below the 40-week moving average line and the weekly OBV line is declining. In the right-hand side of the base prices are above the rising 40-week moving average line and the OBV line is rising -- classic. The MACD oscillator is above the zero line and while the two moving averages of the indicator have narrowed they may not be crossing, all depending on the price action going forward.
In this Point and Figure chart of CI, below, we can see what is called a fulcrum bottom pattern. A trade up to $156 will be a double top breakout and allow us to project a tentative price target of $183 for CI.
Bottom line -- CI looks poised for further gains. Traders and investors looking to get long CI should try to buy it closer to $150 if possible and then risk a close below $145. On the upside our sights are set on the $180-$185 area.