PPG Industries (PPG) gapped lower Tuesday in reaction to its third-quarter guidance. I will leave the number crunching to others who have CFA after their name and I will stick to the charts and indicators with my CMT.
(Read what Jim Cramer has to say about PPG and industrial stocks here.)
In this daily bar chart of PPG, below, we can see the big downside price gap or price void. Volume is heavier than normal as prices have broken the lows of May and July. PPG was already below the declining 50-day and 200-day moving averages. Not pretty.
The daily On-Balance-Volume (OBV) line has turned lower and the Moving Average Convergence Divergence (MACD) oscillator has moved below the zero line for an outright sell signal.
In this weekly bar chart of PPG, below, we have to imagine Tuesday's price action. Prices are sharply below the declining 40-week moving average line.
The weekly OBV line does not (yet) show much weakness and the MACD oscillator has narrowed towards a new sell signal.
In this Point and Figure chart of PPG, below, we can see the decline without a gap. There is a downside price target of $85.81 being projected.
Bottom-line strategy: PPG is weak and probably headed lower. $85 is the Point and Figure target but that does not mean that buyers will show. Stand aside.