Costco Wholesale Corp. (COST) surged higher last Friday as traders and investors were impressed with its earnings beat. We looked at the charts ahead of earnings on Dec. 2 and wrote, " I will assume that traders have booked some profits at our $532 price target. Earnings are approaching and the movements in the broad market averages have probably put some investors on edge. Raise stops to $505 from $445."
Let's stock up on the latest charts and indicators of Costco, which is a holding of the Action Alerts PLUS portfolio.
In this daily bar chart of COST, below, we see a bullish setup. Prices finished the past week very strong on expanded volume. COST is trading above the rising 50-day moving average line and the rising 200-day line. The On-Balance-Volume (OBV) line has confirmed the rising price pattern since its own rise beginning in early March. The Moving Average Convergence Divergence (MACD) oscillator has narrowed and is close to crossing to the upside and a new outright buy signal.
In this weekly Japanese candlestick chart of COST, below, we see a bullish picture. COST is in a longer-term uptrend above the rising 40-week moving average line. There are no top reversal patterns visible and the weekly OBV line is bullish. The trend-following MACD oscillator is in a bullish alignment above the zero line.
In this daily Point and Figure chart of COST, below, we can see that a trade at $565 will refresh the uptrend. A price target of $675 is projected.
In this weekly close-only Point and Figure chart of COST, below, we can see that the software is projecting the $763 area as a potential price objective.
Bottom line strategy: Traders should continue to hold their remaining long positions and keep their stops at $505 for now. The round number of $600 and then the $675 area are our potential price targets.
(COST is a holding of Action Alerts PLUS . Want to be alerted before the portfolio buys or sells these stocks? Learn more now . )
