The price of Deere (DE) has been stuck between $70 and $85 the past 10 months, but prices began to shift upward in January. An upside breakout over $85 this month shows promise of further gains and perhaps the beginning of a much more important longer-term breakout.
In this daily chart of DE, above, we can see how it gapped lower in August and then traded sideways until recently. For much of the September to January period, the price of DE stayed between $70 on the downside and $80 on the topside. From February until this month, DE moved up to a $75 to $85 trading range. A dip in May never got down to $75 and shows that buyers of DE have become more aggressive. The On-Balance-Volume (OBV) moved up and down modestly with prices but took a more positive direction from early April. Prices moved above the 50-day and 200-day moving averages in mid-April and by the end of the month a golden cross was generated. The slope of the 50-day average line is pointed up and it looks like the 200-day average line is flattening. The trend-following Moving Average Convergence Divergence (MACD) oscillator is in a bullish mode above the zero line.
This weekly chart of DE, above, shows the breakout over $85. Prices are above the 40-week moving average line and the line looks like it has turned positive. The weekly OBV line has been inching up the past two months and the MACD oscillator crossed above the zero line for an outright buy signal. Though the chart shows resistance above $90, we might just push up through it this time around. A breakout over $100 is possible -- a level that hasn't be cleared for over five years.