A.O. Smith Corp. (AOS) is one of the world's leading manufacturers of residential and commercial water heaters and boilers. It is not a cutting-edge tech company dealing with AI, but the charts look promising and the company makes money, so let's check the technicals.
In this daily bar chart of AOS, below, I see a low made in September/October followed by a rally into early February. AOS turns sideways from February but the charts are still positive. AOS is trading above the rising 50-day moving average line and above the rising 200-day line. The On-Balance-Volume (OBV) line made a low in October and its rise tells me that buyers of AOS are more aggressive than sellers. The Moving Average Convergence Divergence (MACD) oscillator is above the zero line but correcting.
In this weekly Japanese candlestick chart of AOS, below, I see a constructive chart picture. Prices have emerged from a base pattern following a downside correction. The base measures back to around March 2022. Impressive. AOS trades above the rising 40-week moving average line, so math tells us we have a bullish trend. The weekly OBV line shows strength from October. The MACD oscillator is bullish.
In this daily Point and Figure chart of AOS, below, I can see an upside price target in the $82 area.
In this weekly Point and Figure chart of AOS, below, I used a five-box reversal filter. Here the software gives us an upside price target in the $90 area.
Bottom line strategy: Traders could approach the long side of AOS at current levels. Risk to $65. My price targets are $82 and $90.
