Logistics company FedEx ( FDX) announced a number of moves Wednesday to consolidate operations and cut costs. The stock was up sharply and extending gains in an advance that was started in late September.
Let's check out the charts and indicators to see if this is the time to load up the plane.
In this daily bar chart of FDX, below, I can see that prices are trading above the rising 50-day moving average line and above the bottoming 200-day line. The On-Balance-Volume (OBV) line shows strength from October and tells me that buyers of FDX are more aggressive than sellers.
The 12-day price momentum study shows equal highs from February to April while prices made higher highs. This is a bearish divergence but it may not generate a price correction just yet.
In this weekly Japanese candlestick chart of FDX, below, I see a mixed picture. Prices are in an upward trend but the last plotted candle was a doji indicating a balance between bulls and bears. The candle for this week could be white (bullish) and refresh the uptrend but it is too soon to tell for sure.
The weekly OBV line shows a slight rise from late September but it is far from "robust". The 12-week price momentum study has been slowing in recent weeks.
In this daily Point and Figure chart of FDX, below, I can see a potential upside price target in the $313 area.
In this weekly Point and Figure chart of FDX, below, I see a price target in the $253 area. This is lower than the daily price target. Interesting.
Bottom line strategy: In my review of FDX on March 16, I was not a big fan of the stock ahead of earnings and the subsequent price action proved me wrong. FDX shares are trading higher Wednesday but off their best level suggesting to me that the marketplace has quickly discounted the latest company news. Proceed with caution.
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The charts of the building materials supplier are firming up.
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