Goldman Sachs Group Inc. (GS) is trading up about 3% in pre-market activity Wednesday as traders and investors react to its latest earnings report. I will leave others to go over the top and bottom lines and all those tedious footnotes. Over my pay grade as they say. Instead, let's check out the charts and indicators this morning.
We last looked at GS in late December and things are looking better for the short-run.
In the daily bar chart of GS, below, we can see some positive signals. Prices could test the declining 50-day simple moving average line Wednesday or very soon. A close above the 50-day line will be a positive for some technically oriented traders but I like to see the slope of this indicator turn positive. The 200-day moving average line is bearish and is up above $220 right now.
The volume of trading was heavy in late December and may signal that some longs liquidated while other investors used the selling pressure to go long. The daily On-Balance-Volume (OBV) line turns up from the December nadir and shows a shift to aggressive buying from months of aggressive selling.
The trend-following Moving Average Convergence Divergence (MACD) oscillator crossed to a cover shorts buy signal near the end of 2018 and is now approaching the underside of the zero line. A move above the zero line will be a buy signal.
In the weekly bar chart of GS, below, we can see that prices are still well below the declining 40-week moving average line. The weekly OBV line shows a decline from early 2018 and a recent uptick into January of 2019.
The weekly MACD oscillator has begun to narrow and could soon cross to the upside for a weekly cover shorts buy signal.
In this Point and Figure chart of GS, below, we can see a long decline and an upside price target around $232.
Bottom-line strategy: GS should post a good move to the upside Wednesday and could rally to nearby resistance in the weeks ahead. Resistance begins around $210 and extends up to $240.
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