Emerson Electric Shares Continue to Disappoint

Where's the bullish setup?

Emerson Electric (EMR)  were upgraded to an overweight ("buy") rating at Morgan Stanley a week ago. The company was named the 2023 ENERGY STAR Partner of the Year for Energy Management Tuesday. Lot's of media attention but in my review of March 21 I wrote that "Fundamental analysts can be comfortable recommending stocks in downtrends but technical analysts are not."

Let's visit the charts again.

In this updated daily bar chart of EMR, below, I see a choppy trading pattern the past few weeks. Prices are trading below the declining 50-day moving average line and below the declining 200-day line.

The On-Balance-Volume (OBV) line shows a decline over the past 12 months and that suggests that sellers of EMR are more aggressive than buyers. The Moving Average Convergence Divergence (MACD) oscillator is in a bearish alignment below the zero line. 

 

In this weekly Japanese candlestick chart of EMR, below, I still fail to find a bullish setup. Prices trade below the 40-week moving average line. The candles do not show a bottom reversal pattern that I am familiar with.

 

The weekly OBV line has been declining the past three months. The MACD oscillator remains in a bearish alignment below the zero line.

 

 

In this daily Point and Figure chart of EMR, below, I can see a potential downside price target in the $75 area.

 

 

In this weekly Point and Figure chart of EMR, below, I can see the same downside price target of $75 as seen above in the daily chart.

 

 

Bottom line strategy: As I read them, the charts and indicators of EMR are not in a position to support a sustained advance.

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