Household name Kimberly-Clark (KMB) was upgraded by The Street's quantitative service yesterday, but the charts are not in agreement.
In recent weeks KMB has struggled over the $135 level (chart above). Share prices broke hard to the downside this month. They broke below the 50-day simple moving average line and then gaped lower. Prices are nearing a test of the 200-day average line, after being very extended over it.
The On-Balance-Volume (OBV) line has turned down lately and the Moving Average Convergence Divergence (MACD) oscillator moved below the zero line for a sell signal. In February, March and April we have a bearish divergence with prices moving higher but with momentum flat, giving us the divergence.
In this weekly chart of KMB, above, we can see the OBV line rolling over, telling us that sellers of KMB have become more aggressive on this timeframe. There is a bearish divergence between the higher price highs and the lower momentum readings, telling us that the rate of acceleration in price was slowing into the zenith.
The MACD oscillator on this timeframe signaled a "liquidate longs" sell signal. Prices are nearing the rising 40-week moving average line. With support visible on the chart (former resistance) around $120, we look for further softness in the price of KMB.