Whirlpool Corp. (WHR) has made a very strong price recovery from its March nadir and prices are knocking on a significant upside breakout. Let's skip the laundromat and check out the charts below.
In this daily bar chart of WHR, below, we can see that prices were roughly cut in half in the pandemic slide. The recovery from March has been impressive. Prices moved up rapidly with just a few corrections. WHR is above the rising 50-day moving average line and above the bottoming 200-day moving average line. The quicker to react 50-day line is close to crossing above the 200-day line for a bullish golden cross.
This buy signal is way off the March low but can be useful in long-trending markets. The trading volume was heavy into the March low and suggests that some weaker hands sold out their positions to investors with stronger hands and a bullish vision.
The On-Balance-Volume (OBV) line has been very strong and tells us that buyers of WHR have been more aggressive. The OBV line has led the way and has made a new high - this can foreshadow new price highs.
The Moving Average Convergence Divergence (MACD) oscillator is in a bullish alignment.
In this weekly bar chart of WHR, below, we see a bullish setup. Prices are above the 40-week moving average line. The slope of the 40-week average line is still negative but that should not last for long.
The weekly OBV line has been strong and tells us that buyers of WHR have been more aggressive. This confirms the price gains since March.
The MACD oscillator on this longer time frame is almost crossing the zero line for an outright buy signal.
In this daily Point and Figure chart of WHR, below, we can see a potential upside price target in the $243 area.
Bottom line strategy: Risking a close below $140, traders could go long WHR at current levels and on any one or two day shallow dip. Once over the October 2019 highs, the upside targets become the $200 area and the $243 area.
