During the Lightning Round of Mad Money Wednesday night one caller asked about Dollar Tree Inc. (DLTR) : "This is a great growth stock and it's doing really well," commented Jim Cramer. Let's take a look at some charts and indicators to see if the chart is growing too.
In the daily bar chart of DLTR, below, we can see that prices have been oscillating sideways since March in a wider and wider trading range. There has been lower lows and higher highs the past seven months. This chart pattern has some of the features of a broadening pattern, which can be a continuation pattern or it can be a reversal pattern. Tricky.
Prices have swung above and below the 50-day moving average line getting traders long and short and then long again and then short again. The pattern is frustrating to nearly everyone and typically the trading volume is fairly active.
Here the daily On-Balance-Volume (OBV) line is moving sideways with the price action so we (or at least I) cannot decide if we are seeing accumulation or distribution. The Moving Average Convergence Divergence (MACD) oscillator is well above the zero line but poised to cross to the downside for a take profits sell signal.
In the weekly bar chart of DLTR, below, we have a positive-looking picture. Prices are above the rising 40-week moving average line. The weekly OBV line shows a longer-term uptrend and the MACD oscillator on this time frame is bullish.
In this Point and Figure chart of DLTR, below, we can see a recent upside breakout at $114.23 and a price target of $121.
Bottom-line strategy: The daily chart is a coin toss but the weekly chart and the Point and Figure charts are bullish. The vote is 2 to 1.