Cintas Corp. (CTAS) is due to report its quarterly earnings figures Tuesday and the technical studies and charts show a mixed picture in my opinion. At the beginning of August I looked at the charts and wrote, "The chart of CTAS is amazing. Prices are pointed up with no signs of distribution. $250 is the next upside price target and maybe that objective is conservative. Continue to play CTAS from the long side and risk below $190." Looking at the charts this afternoon I can see that prices are up from the beginning of August but some tests lie ahead.
In this daily bar chart of CTAS, below, I can see that prices are testing the rising 50-day moving average line. All the tests of the 50-day line with the exception of February were buying opportunities. The next test of the 50-day may be successful but we don't know that with complete certainty. The slower-to-react 200-day line is bullish. The daily On-Balance-Volume (OBV) line has made new highs recently to confirm the advance. The trend-following Moving Average Convergence Divergence (MACD) oscillator crossed to a take profits sell signal in early August and it is still pointed lower.
In this weekly bar chart of CTAS, below, we see another mixed picture. Prices are above the rising 40-week moving average line. The weekly OBV line has rolled over and the MACD oscillator is close to a bearish crossover and take profits sell signal.
In this Point and Figure chart of CTAS, below, we can see an upside price target of $247 and that a decline to $199.42 would weaken the chart.
Bottom line strategy: I have no idea what the react will be to the CTAS earnings release. (Jim Cramer is expecting good results.) The charts and indicators are mixed so anything could happen in the short-run. The bigger picture is a long-term bullish story with a higher price target. Raise sell stops to a close below $199.