Lending Tree Inc. (TREE) was last reviewed in February, ahead of earnings. At the time we wrote that, "TREE has produced some pretty impressive gains for investors of the past two years. With the charts and indicators starting to show some bearish signals, investors and traders should consider nailing down or booking some profits ahead of the upcoming earnings report." From late February the share price of TREE has tumbled but a low has not yet been established. Let's check the charts to see what may be in store for TREE.
In this updated daily bar chart of TREE, below, we can see that TREE has been below the cresting 200-day moving average line for the past two months. A bearish dead cross can be seen at the end of May as the 50-day average declined below the 200-day line. Support from August-October is close to being broken, opening the way to further declines. The daily On-Balance-Volume (OBV) line shows a decline from January telling us that sellers of TREE have been more aggressive for nearly six months. The Moving Average Convergence Divergence has been below the zero line since February which is bearish.
In this weekly bar chart of TREE, below, we can see that my favorite indicators are bearish. Prices are below the cresting 40-week moving average line. The weekly OBV line remains on the defensive and the MACD oscillator is in bearish territory below the zero line.
In this Point and Figure chart of TREE, below, we can see the breakdown to new lows. A potential downside price target of $178.97 is being projected.
Bottom line: The indicators are bearish. Support is old and nearly broken. The Point and Figure chart shows a bearish price target. Traders and investors should avoid the long side of TREE.