Procter & Gamble Co (PG) reported their latest earnings numbers this Wednesday morning and prices were up sharply. We looked at PG on December 30 and wrote, "Continue to hold longs in PG from prior recommendations. Raise stops to $156. The $179 area is our next price target with the round number of $200 after that."
Let's check out the charts again in light of their positive EPS, revenue numbers and guidance.
In this daily bar chart of PG, below, we can see that prices are moving strongly to the upside. The slope of the 50-day moving average line and the slower-to-react 200-day line are both positive. The On-Balance-Volume (OBV) line shows a positive trend the past 12 months and only some leveling off in recent weeks. The Moving Average Convergence Divergence (MACD) oscillator has crossed to the downside for a take profit sell signal.
In this weekly Japanese candlestick chart of PG, below, we can see that prices have maintained a longer-term uptrend. The slope of the 40-week moving average is bullish. The weekly OBV line shows only a small dip and the MACD oscillator has narrowed but is not close to a crossover.
In this daily Point and Figure chart of PG, below, we can see an upside price target of $173. In our last snapshot of this chart on December 30th the software gave us a $179 price target. A lower price target may be telling us something.
Bottom line strategy: With the lower price target of $173 for PG now, I think we should change our technical strategy. Traders should look to take profits towards the $173 area. I use the word "towards" as weakness in the broad market could prompt some traders to exit early.
