Lowe's (LOW) made upside progress the first part of this year, but the second half of 2016 could see a correction.
In this daily chart of LOW, above, we can see the gains from the February low. Prices are above the rising 50-day and 200-day moving averages. The daily On-Balance-Volume (OBV) line firmed along with the price action. Nothing wrong yet.
Momentum is our favorite leading indicator and in the lower panel we can see the lower momentum high in June vs. the equal price highs. This bearish divergence is not "huge" but it is a heads up as we head into the third quarter.
In this three-year weekly chart of LOW, above, we can see that prices are above the rising 40-week moving average line. There is not a big gap between the average line and prices as in early 2015, but the direction is positive. This also means that if prices decline about $5 they could break below the moving average.
This weekly chart shows two other potential problems. First, the OBV line made a high in early 2015 and we have yet to break above it despite prices making new highs. Second, the Moving Average Convergence Divergence (MACD) oscillator is poised to signal a liquidate longs sell signal.
A close below $75 is likely to put the bears back in control.