We last reviewed the charts of Berkshire Hathaway (BRK.B) on July 23 where we wrote that, "Having a bearish view on Berkshire Hathaway is probably not popular but that is how the charts and indicators are shaping up. The key level is the late May lows around $197.44 on the Point and Figure chart. A break of this level will give the bears the upper hand." BRK.B ignored my interpretation of the charts and rallied to around $220 before rolling over again.
In this daily bar chart of BRK.B, below, we can see that prices have made a small top formation since early August. August looks like a "left shoulder" with September as the "head", and October the "right shoulder" of a small head and shoulders pattern. Because of its size this is not a major top formation but we are likely to see price weakness into year-end.
BRK.B is trading below the cresting 50-day moving average line. The 200-day moving average line still has a negative slope.
The On-Balance-Volume (OBV) line has been rising through this pattern which suggests that buyers have been more aggressive. This is interesting as buyers of BRK.B may be caught "offsides" if prices weaken much more.
The Moving Average Convergence Divergence (MACD) oscillator has slipped below the zero line for an outright sell signal.