Deere Is Seeing Green After Earnings: How to Trade the Stock Now

Despite trade issues and the coronavirus DE has managed to turn in good numbers.
Stocks quotes in this article: DE

Deere & Company (DE) rallied to the top of its trading range and is still pushing higher Friday as traders and investors liked the company's latest earnings figures. DE beat expected EPS and revenue numbers handily. Prices have gapped to the upside so let's put on our green baseball cap and check out the charts. 

In the daily bar chart of DE, below, we can see that prices have quickly responded to the fundamental news and have gapped higher. Prices were above the 50-day moving average line and the 200-day moving average line coming into Friday. The slopes of both averages are likely to turn positive in the days ahead.

The On-Balance-Volume (OBV) line has been steady since early November and remained firm even when the price of DE declined. A new high in the OBV line is likely by Friday's close.

The Moving Average Convergence Divergence (MACD) oscillator gave a cover shorts buy signal earlier this month and should cross the zero line soon for an outright go long signal.  

 
In the weekly bar chart of DE, below, we can see that prices are above the rising 40-week moving average line. Prices are likely to make a new weekly high close Friday.
 
The weekly OBV line shows a long-term (three year) uptrend to support the price gains. The MACD oscillator on this longer time frame is above the zero line and could cross to the upside in the weeks ahead.  
 
 
In this daily Point and Figure chart of DE, below, we can see the morning gains without a price gap. DE has made a new high for the move up and a $212 price target. 
 
 
 
Bottom-line strategy: Bears will have a hard time arguing with a gap higher and new highs. Despite trade issues and the coronavirus DE has managed to turn in good numbers and the charts have responded in kind. Trade DE from the long side, looking for the $212 as our first price target.
 
Get an email alert each time I write an article for Real Money. Click the "+Follow" next to my byline to this article.

Employees of TheStreet are prohibited from trading individual securities.

TAGS: Earnings | Investing | Stocks | Technical Analysis | Agriculture | Industrial Goods

More from Stocks

The Promise of Hemp Begins to Fade

Debra Borchardt

There are huge problems now plaguing the industry, which was just beginning to recover from last year's oversupply issues.

Active vs. Passive Trading: The Key to Big Gains Is Stalking Your Trades

James "Rev Shark" DePorre

Take control of your trades rather than just sitting and hoping that they work.

This Is Not Bearish Market Action, It's Transitional Action

James "Rev Shark" DePorre

The week saw some of the best rotational action out of leadership names that I can ever recall seeing.

Is Marvell Technology the One 'You Want' Technically?

Bruce Kamich

Let's check out the charts of this semiconductor stock.

I Like the Setup for a Bearish Call Spread for Penn National Gaming

Timothy Collins

I'm not bearish PENN in the long-term, but shares are trading 50% above their 50-day simple moving average.

Real Money's message boards are strictly for the open exchange of investment ideas among registered users. Any discussions or subjects off that topic or that do not promote this goal will be removed at the discretion of the site's moderators. Abusive, insensitive or threatening comments will not be tolerated and will be deleted. Thank you for your cooperation. If you have questions, please contact us here.

CANCEL
SUBMIT

Email sent

Thank you, your email to has been sent successfully.

DONE

Oops!

We're sorry. There was a problem trying to send your email to .
Please contact customer support to let us know.

DONE

Please Join or Log In to Email Our Authors.

Email Real Money's Wall Street Pros for further analysis and insight