Merck & Co. (MRK) was favored by Jim Cramer during his Mad Money program Friday night in anticipation of good news Thursday from its investor day. Let's check out the charts ahead of any announcements on Thursday.
In the daily bar chart of MRK, below, we can see a positive trend higher the past twelve months. Notice that MRK hardly dipped in the fourth quarter of last year, and has also ignored most of the broad market weakness this year as it pushed up to new highs this month. MRK is above the declining 50-day average line and the rising 200-day line.
The daily On-Balance-Volume (OBV) line has moved higher the past year as MRK has traded higher -- a positive sign. The Moving Average Convergence Divergence (MACD) oscillator is above the zero line, but has narrowed a little in recent days.
In the weekly bar chart of MRK, below, we can see prices are above the rising 40-week moving average line.
The weekly OBV line has been bullish since the end of 2017, and the MACD oscillator is poised to cross to the upside for a fresh outright buy signal.
In this first point and figure chart of MRK, below, we can see a price target of $88.
In this second point and figure chart of MRK, below, we used only weekly close data to construct the chart, and here the longer-term price target measures to the $127 area.
Bottom-line strategy: Investors and traders should approach MRK from the long side. Risk below $76 looking for gains to the $88-$90 area and then the $125 area.