On Tuesday Best Buy Co. Inc. (BBY) beat third-quarter expectations on earnings and revenue and lifted its guidance to above expectations for the full year on a positive view of the holiday quarter. Things sound rosey, so let's check out the charts and indicators for the Real Money Stock of the Day.
In the daily bar chart of BBY, below, we can visualize prices opening with a gap to the upside and trading in the $77-$78 area. Prices will remain above the rising 50-day moving average line and the rising 200-day line.
The On-Balance-Volume (OBV) line has been in a positive mode since December and could well make a new high for the move up Tuesday.
The Moving Average Convergence Divergence (MACD) oscillator is currently above the zero line in a take profits sell mode but strength tuesday and the next several days could turn this indicator to the upside again.
In the weekly bar chart of BBY, below, we can imagine that prices are above the highs of 2019 and challenging the 2018 peak. BBY is above the rising 40-week moving average line.
The weekly OBV line has been rising from its December 2018 low and is poised to make a new high for the move up. A new high on the OBV line will confirm the price gains. The MACD oscillator is in a bullish mode above the zero line.
In this Point and Figure chart of BBY, below, we used weekly close-only data to construct the chart. Here a potential longer-term price target of $125 is being indicated.
Bottom-line strategy: A strong close Tuesday for BBY above $78 will set the stage for further strong gains. Hold if you are long. Go long if flat and risk a close below $71 now. Our upside price targets are $100 and then $125.