Treehouse Foods Inc. (THS) has rallied up to the $55 area a number of times in the past six months or so and each time prices have retreated. The On-Balance-Volume (OBV) line suggests we will see an upside breakout at some point in time. Let's check.
In the daily bar chart of THS, below, we can see prices are above the rising 50-day moving average line and the bullish 200-day line. The daily OBV line has been firm from March and is just a fraction away from a new high telling us that buyers of THS have been more aggressive.
The Moving Average Convergence Divergence (MACD) oscillator moved above the zero line in November for an outright go long signal.
In the weekly bar chart of THS, below, we can see a downtrend that ended in early 2018 followed by a sideways trend or consolidation pattern. Prices are trading above the rising 40-week moving average line.
The weekly OBV line shows some softness the past four months which is different from the daily OBV trend. The weekly MACD oscillator is just barely above the zero line.
In this weekly Point and Figure chart of THS, below, we can see how prices have stalled and we can see that $55.80 is the breakout point on this chart. An upside price target of $77 is being indicated.
Bottom-line strategy: Aggressive traders who have capital to risk and are not hiding under their desks could go long THS on an upside breakout at $55.80 or higher and risking below $50. The $75 area is our upside price target.