CenterPoint Energy (CNP) has made a "high level" consolidation the past seven months. Prices have broken out on the upside on a Point and Figure chart (below) and traders can buy CNP here, risking below $23. Check out the charts below and see if you agree.
In this one-year daily chart of CNP, below, we can see that prices have trended sideways for the second half of the year. During this consolidation phase, the volume pattern has been constructive. If you look closely at the volume histogram right below the price chart, you should see that the volume increased on the advances and was lighter on the retracements. Prices are above the rising, 50-day and 200-day moving averages.
The On-Balance-Volume (OBV) line moved up early in the year and has remained steady since July. The Moving Average Convergence Divergence (MACD) oscillator moved above the zero line in early November for an outright go-long signal.
In this weekly chart of CNP, above, you can see a large V pattern followed by the consolidation pattern we noted above. Prices are above the rising, 40-week moving average line. The weekly OBV line is positive, especially in the first half of 2016. The weekly MACD oscillator just crossed for a fresh go-long signal.
This Point and Figure chart of CNP, above, shows a clear breakout to a new high and a possible longer-term price target of close to $40.