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  1. Home
  2. / Investing
  3. / Stocks

Honeywell May See a Deeper Pullback in the Next Few Weeks

Indicators have weakened recently.
By BRUCE KAMICH
Feb 05, 2021 | 11:47 AM EST
Stocks quotes in this article: HON

The stock market is back in rally mode, and with the Super Bowl just a few days away, Jim Cramer told his Mad Money viewers Thursday evening that it's time to nominate his starting lineup of stocks that are likely to score a touchdown for your portfolio.

If you're looking for an unbeatable team of stocks, you can't do better than the Mad Money starting lineup. Honeywell International Inc. (HON) , the best industrial technology company money can buy.

Let's check out the charts.

In the daily bar chart of HON, below, we can see that the shares made a peak in December and have drifted lower. Prices are now trading below the declining 50-day moving average line. The 200-day moving average line intersects around $170.

The On-Balance-Volume (OBV) line has "rolled over" the past three months. The Moving Average Convergence Divergence (MACD) oscillator is below the zero line in sell territory but it is poised for a cover shorts buy signal.

In the weekly bar chart of HON, below, we can see how the indicators have weakened in recent weeks. Prices are still above the rising 40-week moving average line.

The weekly OBV line is pointed down now and tells us that sellers have become more aggressive. The MACD oscillator has crossed to the downside for a take profit sell signal.

In this daily Point and Figure chart of HON, below, we can see a projected downside price target of around $180 or so.

In this weekly Point and Figure chart we see a price target of $227.

Bottom line strategy: HON has rolled over the past three months. Our daily Point and Figure chart has a downside price target and a number of indicators have weakened. Traders should keep their stop loss orders at $194. A pullback to the $180-$170 area is likely.

(Honeywell is a holding in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells HON? Learn more now.)

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TAGS: Investing | Stocks | Technical Analysis | Technology | Industrials | Mad Money

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