Earnings reports are being released today and they will continue on Wednesday with Bank of America (BAC) , one company that Jim Cramer is keeping an eye out for. Let's check the charts and technical indicators this morning to see if anyone is positioning for an upside breakout.
In this daily bar chart of BAC, below, we can see that prices have been stuck in a sideways trading range all year. Followers of moving average crossovers have been buying and selling and buying and selling as prices have moved up and down around the 50-day and 200-day moving averages.
The On-Balance-Volume (OBV) line has also moved sideways to slightly lower this year suggesting that traders and investors have been liquidating (selling) positions.
The Moving Average Convergence Divergence (MACD) oscillator has also moved around the zero line all year.
In this weekly bar chart of BAC, below, we can see that despite the sideways price action this year the 40-week moving average line has turned upwards with a positive slope and prices now are just above that indicator.
The weekly OBV line has been steady all year and one or two strong weeks of volume and higher closes could turn the line bullish.
The weekly MACD oscillator is hugging the zero line now but like the OBV line it could turn up quickly above the zero line for a buy signal.
In this Point and Figure chart of BAC, below, we can see the movement of prices without the daily noise. Beneath the surface of the sideways price action there has been some quiet accumulation (buying) and an upside price target of $37 is being projected.
Bottom line strategy: I have no special insight about Wednesday's earnings numbers for BAC but the sum of the charts suggest to me that traders should be prepared and positioned for an upside move.
