United Parcel Service, Inc. (UPS) made a nice rally from its May low but this member of the Dow Transportation Average has turned down in recent days and there does not seem to be a u-turn or jug handle on the charts to turn things around yet. Are the charts discounting a weak holiday period ahead or will higher energy prices and other costs hurt the bottom line? I don't know what UPS investors are focused on, but let's check on the latest charts and indicators.
In this daily bar chart of UPS, below, we can see that prices are below the cresting 50-day moving average line. The slightly rising 200-day line is not all that far below the market. The daily On-Balance-Volume (OBV) peaked last month and its weakness tells us that sellers of UPS have become more aggressive. The Moving Average Convergence Divergence (MACD) oscillator has declined below the zero line for an outright sell signal.
In this weekly bar chart of UPS, below, we can see that prices stalled out around $120 -- right around the prior December 2016 high. Prices are above the rising 40-week moving average line but a close below $110 would break the line. The weekly OBV line looks like it peaked in October and the weekly MACD oscillator is crossing to a weekly take profits sell signal.
In this Point and Figure chart of UPS, below, we can see a downside price target of $104.74. Support extends down to $101.37 and a break of that level is likely to precipitate further declines.
Bottom line: There is some potential chart support in the $112-$110 area but we cannot rule out further declines to around $108.