Danaher (DHR) is a globally diversified conglomerate. The stock has rallied significantly over the past three years, but prices have been stuck in a consolidation pattern, since August. Are we due for a breakout or will we remain stalled a bit longer? Let's check out the charts and indicators.
In this daily bar chart of DHR, below, we can see that prices have been trading sideways between $290 and $330. Prices have crisscrossed around the 50-day moving average line. Prices recently dipped down toward the rising 200-day moving average line but the trading volume has not been very strong on the dip to tell us that others viewed it as a buying opportunity. The On-Balance-Volume (OBV) line has drifted a little lower since September and suggests that sellers of DHR have been more aggressive than buyers. The Moving Average Convergence Divergence (MACD) oscillator has been hugging the zero-line and tells us that DHR lacks "trend strength."
In this weekly Japanese candlestick chart of DHR, below, we see mixed signals. Prices are in a longer-term uptrend and trade above the rising 40-week moving average line. Prices have traded sideways and recently tested the 40-week line. Unfortunately trading volume has been light and the weekly OBV line is "flat lined." The MACD oscillator is pointed down in a take-profit sell mode.
In this daily Point and Figure chart of DHR, below, we can see a potential downside price target of $253.
In this weekly close only Point and Figure chart of DHR, below, we can see a potential upside price target in the $403 area.
Bottom line strategy: The longer-term trend of DHR is bullish, but we first must deal with the short-term trend, which remains sideways. A rising OBV line should be watched for as a clue that DHR is getting ready for an upside breakout. Bide your time.
