ICL Group ( ICL) is in the business of making specialty chemicals for a number of industries. Let's look at two charts.
In this daily bar chart of ICL, below, we can see that prices have been correcting lower since April. Prices made a low in September and slightly lower low in November. Prices are below the declining 50-day and the declining 200-day moving average line.
The On-Balance-Volume (OBV) line made a low in September and did not retest that low in November -- a bullish divergence. In the lower panel is the 12-day price momentum study. Momentum made a low in September with prices, but a higher lower in November when prices made a lower low. Another bullish divergence.
In this weekly Japanese candlestick chart of ICL, below, we can see some subtle positives. Can you see a few lower shadows around $8? The weekly OBV line has turned up strongly and there is a bullish divergence from the 12-week momentum study.
Bottom line strategy: Aggressive and nimble traders could go long ICL for a recovery or rebound rally. Risk a close below $8.
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The bears are absolutely convinced that this market move is unjustified -- but what we're seeing has very little to do with fundamentals or the economy.
Caterpillar can move earth, but can it move its charts in the right direction?
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