Monday night Jim Cramer told his Mad Money viewers that he added John Deere (DE) to his list of infrastructure picks. Let's check out the charts and indicators of this iconic agriculture company.
In this daily bar chart of DE, below, we can see that prices are in a longer-term uptrend but are retesting their May highs. Prices are trading above the rising 50-day moving average line and above the rising 200-day line. The trading volume looks like it has been weakening since June and I do not consider that a positive development. Expanding volume would be preferred.
The On-Balance-Volume (OBV) line is confirming the price action as it retests its May high. The Moving Average Convergence Divergence (MACD) oscillator is in a bullish alignment above the zero line.
In this weekly Japanese candlestick chart of DE, below, we see a bullish picture. Prices are in a longer-term uptrend and trade above the rising 40-week moving average line. Prices dipped towards the 40-week line in June and July.
The OBV line is bullish and close to making a new high to confirm the price gains. The MACD oscillator has narrowed and is getting closer to a new buy signal.
In this daily Point and Figure chart of DE, below, we can see that the software is projecting a potential price target in the $438 area.
In this weekly Point and Figure chart of DE, below, we can see a tentative $505 price objective.
Bottom line strategy: Traders could look to buy a dip to $375 risking to $345. The $438 area is our first price target.
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