Agricultural chemicals company FMC (FMC) has surged to the topside in recent sessions and is extended (read overbought), but further gains are possible after a consolidation. Let's look at the latest charts and indicators to see where we can probe the long side.
In this daily chart of FMC, above, we can see two long consolidation patterns that ended in strong rallies. The first consolidation pattern is from May to early November and the second pattern is from December to near the end of March. Prices are above the rising 50-day moving average line and well above the rising 200-day moving average line.
The daily On-Balance-Volume (OBV) line has an upward slant the past year and a sharper rise recently. Overall, the rising OBV line tells us that investors have accumulated shares of FMC. The Moving Average Convergence Divergence (MACD) oscillator is strongly bullish as it has moved up sharply with the recent strong price action.
In this weekly chart of FMC going back four years, above, we can see that prices are above the rising 40-week moving average line. Prices have rallied all the way back toward the early 2014 zenith in the $75 to $85 area. The weekly OBV line has moved up with the price action and recently made a new high for the move up, confirming the price action. The weekly MACD oscillator remains bullish and just issued a fresh outright go-long signal.
In this Point and Figure chart, above, we can see a long-term view of the price action without volume or any indicators. Currently FMC has an upside target of $82+, which will be a breakout over the 2014 highs. This anticipated breakout should give us higher upside price objectives.
Bottom line: The bull is in charge of FMC, so we want to be a buyer. FMC might have a shallow and brief pullback and that should be used to buy. I would recommend a stop close only order below $69.