Post Holdings, Inc. (POST) was covered by our own Jim Cramer on his Mad Money program last night. Cramer noted that the cereal and packaged foods manufacturer had made a strong upside move recently.
Let's check out the charts and indicators this morning (over some cereal of course) to see what sort of upside remains.
(For more on POST, see: How This Selloff Works: Cramer's 'Mad Money' Recap)
In this daily bar chart of POST, below, we can see an impressive bottom formation from October to June which includes a double bottom in February and March. Prices started to really rally in May and they closed above the rising 50-day moving average line and the bottoming 200-day line.
In the end of June we saw a bullish golden cross which happens when the 50-day average moves above the slower-to-react 200-day line.
In early February at the bottom the volume was very heavy and the On-Balance-Volume (OBV) line turned up. The rising OBV line tells us that buyers of POST are acting more aggressive.
The trend-following Moving Average Convergence Divergence (MACD) oscillator moved above the zero line in early June for an outright go long signal.
In this weekly bar chart of POST, below, we can see a large two-year consolidation pattern with a breakout over the highs in the upper $80's. Prices are above the rising 40-week moving average line.
The weekly OBV line has improved the past three months and the MACD oscillator is also bullish on this longer time frame.
In this Point and Figure chart of POST, below, we can see an upside price target of $110.89.
Bottom line strategy: POST broke out on the upside earlier this month. The recent price action is positive as it corrects the steep run-up. Aggressive traders could go long POST at current levels risking below $90 for now. The $110 area is our first price target.