Rowan Cos. plc (RDC) was upgraded today to a Hold by TheStreet's Quant Ratings service. A Hold may not seem as strong as a Buy recommendation but it may present us with a better risk/reward ratio than a signal later in an advance. Let's take a look at the charts to see what they can add to the investment decision-making process.
In the daily bar chart of RDC, below, we can see that prices broke out to the upside in September -- the highs of January and May and July were broken. The slope of both the 50-day moving average line and the 200-day line are positive and a bullish golden cross also happened in September.
The daily On-Balance-Volume (OBV) line starts to show strength in August and tells us that buyers of RDC have turned more aggressive. The Moving Average Convergence Divergence (MACD) oscillator crosses to the upside in August for a cover shorts sign and in early September it crosses the zero line for an outright go long signal.
In the weekly bar chart of RDC, below, we can see a base pattern going back to early 2016. A weekly close above $20 or $21 will be an important upside breakout. Prices are above the rising 40-week moving average line.
The weekly OBV line is pointed up and the MACD oscillator is bullish.
In this Point and Figure chart of RDC, below, we can see an upside price target of $33. A breakout would be $22.
Bottom-line strategy: Risking a close below $17.50 traders could go long RDC here. Add above $22 looking for gains to the $33-$35 area.