We reviewed the charts of Enterprise Products Partners (EPD) back in November, and said, "We do not have a strong sense that EPD is done declining, but we can suggest probing the long side on strength above $25.50, risking below $24. This seems to be a small amount to risk." EPD did rally above $25.50 in December and moved up to $29.50 before retreating back to retest the November lows. Prices made a round trip and this could be an opportunity to go long again.
In this daily bar chart of EPD, below, we can see how prices have rallied this month to close above the declining 50-day moving average line and test the underside of the 200-day line. The daily On-Balance-Volume (OBV) line has moved up signaling more aggressive buying. The 12-day momentum study at the bottom of this chart shows a pattern of higher lows which is a bullish divergence when compared to the pattern of lower price lows. This divergence from February points to a rally.
In this weekly bar chart of EPD, below, we can see that prices are about to test the underside of the declining 40-week moving average line. The weekly OBV line has been weakening the past three months. The Moving Average Convergence Divergence (MACD) oscillator has narrowed recently and could generate a cover shorts buy signal in the weeks ahead.
In this Point and Figure chart of EPD, below, we can see an upside price target of $29.14.
Bottom line -- if you can risk below $24 then go long EPD here looking for a rally to retest the January high.
