We have not looked in on the charts of Children's Place, Inc. (PLCE) for a year, but way back in November 2016, we said, "Price targets? The height of the eight-month consolidation is $25 at its widest point, and adding that to the breakout at $90 gives us $115 as an initial price objective. A point and figure 'count' gives us a $125 price target." Now that PLCE has passed our $115 and $125 price targets, a fresh look at this retailer is needed.
This year, PLCE traded sideways for eight months between $95 and $125, which should give us a target of $150, and the Point and Figure chart suggests $145-$146. But let's check all the charts and indicators to decide on a strategy.
In this daily bar chart of PLCE, above, we can see the a gap to the upside on heavy volume in early March. From March through October, we can see the neutral trading range, with prices crossing above and below the 50-day and 200-day moving averages.
By late October/early November, PLCE is strong enough to rally above the rising 50-day average line and the rising 200-day line. The On-Balance-Volume (OBV) line turned up in June and again in October, with new highs in November.
A rising OBV line tells us that buyers of PLCE have been more aggressive than sellers, and the breakout to new highs on the OBV line confirms the price breakout.
The trend-following Moving Average Convergence Divergence (MACD) oscillator moves around the zero line for much of the past 12 months, but it, too, breaks out on the upside earlier this month.
In this weekly bar chart of PLCE, above, we can see that prices are above the rising 40-week moving average line. The weekly OBV line is strong and the MACD oscillator on this time frame has turned up for a fresh outright go long signal.
In this Point and Figure chart of PLCE, above, we can see a breakout at $124.93 and a potential price target of $145.38.
Bottom line: if you are long PLCE from lower levels, continue to hold for higher price targets, but consider raising sell-stop protection to a close below $125. The $150 area is the most likely price target as we head into year-end.
