O'Reilly Automotive (ORLY) broke out on the upside Thursday on the heels of their earnings beat. Let's check out the charts and indicators to see if things will continue to fire on all cylinders.
In this daily bar chart of ORLY, below, we can see that prices made a "V" bottom in late March followed by a very brief retest before prices raced higher. Prices rallied up into June and then traded sideways for a few weeks before their recent upside breakout to new highs.
ORLY is trading above the rising 50-day moving average line and the rising 200-day moving average line. In late June we can see that these two averages crossed to generate a bullish golden cross buy signal.
The On-Balance-Volume (OBV) line has moved higher from its matching March low and has moved up to new highs which tells us that buyers of ORLY have been more aggressive. This is a positive sign for the likelihood of the rally continuing.
The trend-following Moving Average Convergence Divergence (MACD) oscillator turned upwards earlier this month for a fresh outright go long signal.
In this weekly bar chart of ORLY, below, we can see that prices have been in an uptrend the past three years. The early 2020 selloff was deep but prices have made new highs to refresh the uptrend. ORLY is above the rising 40-week moving average line.
The weekly OBV line has been strong the past four months and the MACD oscillator gave a buy signal in May/June when it crossed above the zero line.
In this daily Point and Figure chart of ORLY, below, we can see that prices have made new highs and there is a relatively nearby price target of around $494.
In this weekly Point and Figure chart of ORLY, below, we can see an upside price target in the $504 area.
Bottom line strategy: Continue to trade ORLY from the long side risking a close below $435. The $505 area is our first upside price target.
