Delphi Automotive (DLPH) stepped on the gas and broke out on the upside last week -- a strong upside gap accompanied by heavy volume. Prices have pushed up into overhead resistance that extends up to $90.
A weekly close above $90 will be a more important upside breakout with still higher price targets. Let's take a look under the hood at the latest charts and indicators.
In this daily chart of DLPH, below, we can see a neutral or sideways trend from May to the end of December. From early January the chart and the indicators get stronger. The popular 50-day moving average line crosses above and below the price action during the sideways period -- not unusual and typically very frustrating and a money losing period. Prices rally in early December and then slowly pull back to the 50-day average which has begun to curve upward. By the end of January the 50-day average line has crossed above the 200-day moving average line for a bullish golden cross. The On-Balance-Volume (OBV) line was steady up to October and then it strengthens more noticeably. The OBV line recently made a new high supporting the breakout on prices. The Moving Average Convergence Divergence (MACD) oscillator is above the zero line in a bullish mode.
In this weekly chart,below, of DLPH going back four years, we can see how prices have curved around the past year and are back to their previous highs. DLPH is above the rising 40-week moving average line. The weekly OBV line has been strong the past four months and is close to a breakout to new highs. The weekly MACD oscillator is in a bullish mode above the zero line.
In this Point and Figure chart of DLPH, below, we can see a breakout trade at $87 and a possible or tentative longer-term price target of $113.
Bottom line - DLPH is likely to trade sideways for a few days or maybe a week or more consolidating its recent gains. DLPH is anticipated to break out to new highs above $90 and on its way to around $113. Traders could go long on a close above $90 and then risk a close below $84.