Goldman Sachs (GS) is scheduled to report its third-quarter earnings figures in about a week and a half and the financial powerhouse and a sell-side firm was just raised its recommendation to a "buy" (outperform) with a $429 price target. Many market watchers will be closely watching the earnings of the banks in the days and weeks ahead so let's dive in and check the charts of Goldman.
In the daily bar chart of GS, below, we can see that shares declined earlier this year along with many other financial institutions. Prices made a low in June and a quick retest in July. A rally unfolded into the middle of August and then gravity took over again. Prices are currently holding above the June/July lows. GS is trading below the declining 50-day and the declining 200-day moving average line.
Trading volume increased in July on the "retest" and that is a positive sign telling us that technically oriented traders saw a trading opportunity. The On-Balance-Volume (OBV) line did not bottom until July and made only a limited recovery into August. A strong OBV line is needed to give traders confidence in the upside. The Moving Average Convergence Divergence (MACD) oscillator is bearish but trying to generate a cover shorts buy signal.