Shares of Manchester United plc (MANU) moved sharply higher Wednesday as traders reacted to news that the football club's owners were considering a sale of the popular franchise. Soccer fans do not always think rationally and the number of clubs is limited so we may be in a "bidding war" atmosphere for this asset.
Let's check out the charts.
In this daily bar chart of MANU, below, we can see a low in prices in July followed by a rally into September with a correction into October. Trading volume is typically on the low side but we can see that there was a volume surge in August and a surge now in November.
MANU has broken above the highs of September and April. Prices are trading above the 50-day and 200-day moving averages.
The daily On-Balance-Volume (OBV) line bottomed in July and has moved higher into November. The Moving Average Convergence Divergence (MACD) oscillator recently crossed above the zero line for a new outright buy signal.
In this weekly Japanese candlestick chart of MANU, below, we can see a very choppy trading pattern for this stock. Recently the price action improved with a base pattern the past year. A neckline around $15 has been broken on the upside and prices are above the 40-week moving average line.
The weekly OBV line is bullish and rising, and the MACD oscillator is also bullish.
In this daily Point and Figure chart of MANU, below, we can see an upside price target in the $27 area.
Bottom line strategy: MANU is an unusual asset and probably hard to value by equity analysts. Without being a fly on the wall in the boardroom of the company I would not make a trading recommendation. But if you are interested in buying a club jersey I would do it now as it is probably going to be more expensive when the new owners take over. Just saying. My gut says that an owner of some other franchase will be the buyer.
