We reviewed 3M Co (MMM) last month, and we held to a bullish stance, saying "Traders and investors should stay long." Last month prices gaped higher on heavy volume. Will the gap be filled, or are we looking at perhaps a runaway or measuring gap -- a gap in a trend?
Let's check the charts and indicators below.
In this daily bar chart of MMM, above, we can see the uptrend of the past twelve months. Prices are above the rising 50-day moving average line, as well as the rising 200-day average line.
The On-Balance-Volume (OBV) line has been going up for the past twelve months and tells us that buyers of MMM have been more aggressive. The Moving Average Convergence Divergence (MACD) oscillator has been above the zero line for most of the past year and is well above the zero line now. The two moving averages that make up this indicator have begun to narrow, and could go on to signal a take-profits sell signal.
In this weekly bar chart of MMM going back three years, above, we can see that prices are above the rising 40-week moving average line. The weekly OBV line has been bullish since February. The weekly MACD oscillator, unlike the daily one, just turned up to a fresh outright go-long signal.
In this Point and Figure chart of MMM, above, we can see the uptrend, a $315 potential price target, and that prices could probably use a period of sideways consolidation.
Bottom line: I think MMM will be making a sideways consolidation in the $230-$240 area before moving still higher. Hold longs and raise sell stops to a close below $215 for investors.