Industrial equipment supplier Fastenal Company (FAST) reported latest quarterly figures Thursday morning, revealing an earnings beat and a revenue miss. FAST posted earnings per share of $0.52, which beat estimates by $0.01 and revenue of $1.86 billion, which missed by $10 million. FAST declined Thursday but finished the day near the highs of the session after a test of the 200-day moving average line.
The market is a discounting mechanism.
Let's review the charts on Friday.
In this daily bar chart of FAST, below, I can see that prices are trading higher Friday after a test of the 200-day moving average line. Prices are closer to an upside breakout than a downside breakdown. The trading volume is higher but the On-Balance-Volume (OBV) line is still weak because prices closed lower Thursday. The Moving Average Convergence Divergence (MACD) oscillator is just slightly above the zero line.
In this weekly Japanese candlestick chart of FAST, below, I can see a number of bullish signals. Prices are trading above the 40-week moving average line. The weekly OBV line shows improvement and the MACD oscillator is above the zero line.
In this daily Point and Figure chart of FAST, below, I can see a potential upside price target in the $73 area.
In this weekly Point and Figure chart of FAST, below, I can see the same upside price target of $73 as seen on the daily chart above.
Bottom line strategy: I see the upside on FAST as the course of least resistance. Strength above $55 is key. $56 is a breakout.
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