Deere & Co. (DE) has been stuck in a sideways trading range since April. Declines to around $130 have been bought while rallies to around $160 were sold until today.
Today's gap to the upside changes the pattern to bullish. Let's look closer.
In this daily bar chart of DE, below, we can see the trading range described above. The faster 50-day moving average line moves sideways from late May and the slower-to-react 200-day moving average line quietly rolls over in September and October.
Last week DE rallied above both of these averages and today it gapped to the upside.
The daily On-Balance-Volume (OBV) line has strengthened the past five weeks and the Moving Average Convergence Divergence (MACD) oscillator just crossed to the upside of the zero line for an outright go long signal.
In this weekly bar chart of DE, below, we can see a bullish alignment of our favorite indicators. Prices are above the declining 40-week moving average line.
There is some older chart resistance in the $160-$170 area but it could be broken as prices are already halfway through that resistance zone.
The weekly OBV line has been steady/firm this year and the weekly MACD oscillator is turning above the zero for an outright buy signal.
In this Point and Figure chart of DE, below, we can clearly see the upside breakout over $158.62 and a potential price target of $209.16.
Bottom line strategy: It does not look like DE will get stuck in the winter mud and traders can go long DE on strength above $165 and $170 looking for gains to the $210 area. Risk a close below $155 for now.