Trading in the stock of PPL Corp. (PPL) has gotten narrower in recent months and prices could finally be poised for a breakout, most likely to the upside. Let's check out the charts and indicators before suggesting a strategy.
In this daily bar chart of PPL below, we can see the wide swings in the stock in the fourth quarter of 2018 and the first quarter of 2019. Since March the up and down range of trading has narrowed. This is another way of saying that prices are "compressed" and could be poised for a breakout.
PPL is just above the declining 50-day moving average line and the rising 200-day moving average line.
The daily On-Balance-Volume (OBV) line has been in a relatively narrow range since November with a very narrow range the past six weeks or so. A narrow range and flat volume can sometimes precede a breakout as prices appear balanced and poised for their next move.
The Moving Average Convergence Divergence (MACD) oscillator is above the zero line in positive territory but the two lines are poised for a crossover which depends on the near-term price action.
In this weekly bar chart of PPL, below, we can see the prices are just above the rising 40-week moving average line.
The weekly OBV line has been in a sideways pattern the past 12 months and the MACD oscillator is poised to turn up in a fresh go long signal.
In this Point and Figure chart of PPL, below, we can see an upside price target of $34.26 but a trade at $32.60 is needed to refresh the uptrend.
Bottom line strategy: PPL looks ready to start a move higher. Traders could go long on strength above $32 and above $32.60. Risk below $30.50.