Tempur Sealy International ( TPX) was mentioned by Jim Cramer in his column this morning, "A Checklist for Investors in This Downer of a Market." Let's check out the charts.
In this daily bar chart of TPX, below, we can see that prices bottomed in late December with the broad market, and they have rallied with periodic corrections and a couple tests of the rising 50-day moving average line. The slower-to-react 200-day line has been positive since the middle of January.
Volume has not increased during the rally, but the daily On-Balance-Volume (OBV) line has been positive all year.
The Moving Average Convergence Divergence (MACD) oscillator has been above the zero line since the middle of January, and looks like it could be turning upwards again.
In this weekly bar chart of TPX, below, we can see prices are above the rising 40-week moving average line. A trade above $70 looks like it will be a breakout from a two-year-plus consolidation pattern.
The weekly OBV line is positive, but it is below the highs of 2017. The weekly MACD oscillator is above the zero line and rising, but it has narrowed recently. A crossover signal will depend on the price action in the weeks ahead.
In this point and figure chart of TPX, below, we can see an upside price target of $77.
Bottom line strategy: TPX looks like it can work higher with a $77 price target. Traders can approach the long side of TPX, risking a close below $58. Add on a close above $70.
