3M (MMM) is a diversified technology services company with many of their products ingrained in our lives. Let's check out the charts in light of the latest news of their $10.3 billion legal settlement for "forever chemicals".
(In full disclosure, I had a conversation a few weeks ago with one of my neighbors who is a retired NYFD fire chief. We talked about the banning of forever chemicals by our new home state of Delaware. Really nasty stuff.)
Let's check out the charts and indicators of MMM.
In this updated daily bar chart of MMM, below, I can see that prices made a low in early June. Prices made a significant decline the past 12 months. MMM trades below the declining 200-day moving average line but above the 50-day line now.
The On-Balance-Volume (OBV) line shows some improvement this month. The Moving Average Convergence Divergence (MACD) oscillator has come up to the zero line and is poised for an outright buy signal.
In this Japanese candlestick chart of MMM, below, I can see a bottom reversal pattern at the end of May. Prices have found some buying interest after a long decline. MMM still remains below the declining 40-week moving average line. The weekly OBV line is trying to stabilize and the MACD oscillator is curving upwards for a cover shorts buy signal.
In this daily Point and Figure chart of MMM, below, I can see a $126 price target being projected.
In this weekly Point and Figure chart of MMM, below, I can see a potential downside price target in the $90 area.
Bottom line strategy: A stock that holds its own or rallies in the face of bearish news is telling you something. It tells you that the discounting mechanism of stocks is at work. MMM traders are looking ahead of todays' legal settlement. Traders looking to buy MMM should be patient and wait for more of a base pattern to develop.
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