Sherwin-Williams (SHW) broke out on the upside from a tight sideways trading range last week. Our favorite technical indicators are aligned on the upside and point the way to still higher prices in the months ahead.
In this daily bar chart of SHW, below, we can see that after a number of tests of the rising 50-day moving average line this month, SHW has broken out with a gap to the upside. The rising 50-day moving average line was strong enough to rally above the rising 200-day moving average line in February for a bullish golden cross. The On-Balance-Volume (OBV) line made a low with prices in early November and made new highs for the move up this month, confirming the price gains. The trend-following Moving Average Convergence Divergence (MACD) oscillator just turned up from the zero line for an outright go-long signal.
In this weekly chart of SHW, above, we can see prices are above the rising 40-week moving average line. The weekly OBV line rose steadily from 2014 to mid-2016. The OBV line has turned up again from last November. The weekly MACD oscillator is above the zero line, but it is narrowing for perhaps another crossover signal -- it all depends on the price action from here. Further, gains for SHW will probably keep the MACD oscillator bullish.
In this Point and Figure chart of SHW, above, we see the bullish upside breakout in January at $280. This was a triple-top breakout and opened up the possibility of further gains to the $460 area for SHW. Another breakout happens at $312 and gives us greater confidence in the $460 price target. Point and Figure charts ignore time, so we have no timely ideas on when this ambitious price target may be reached.
Bottom line: With the upside breakout last week, longs could raise their sell stops to a close below $305. If you want to add to longs, I would buy a new high close.