We reviewed the charts of Rivian Automotive ( RIVN) on June 2 and we liked what we saw. We wrote that, "RIVN was trading higher Thursday despite that 'sell' recommendation. A security that does not go down in the face of what is bearish news is a signal that the 'news' has already been discounted. Aggressive traders could go long RIVN at current levels risking to $25. $44 is our price objective."
A month later and the charts are giving us more encouragement.
In the daily bar chart of RIVN, below, we can see that the shares turned down with the broader market averages in November. Prices made a low in early May with heavy volume telling us that there may have been a shift in ownership from weak hands to stronger hands. Prices have been testing the underside of the declining 50-day moving average line for much of June but they look like they can break above this line this month.
The On-Balance-Volume (OBV) line has been steady since early May. The 12-day price momentum study shows higher lows from December for a long bullish divergence.
In the weekly Japanese candlestick chart of RIVN, below, we see a positive-looking chart picture. There are a number of spinning tops the past two months showing us a balance between bulls and bears. The most recent candle is white or bullish.
The weekly OBV line is steady and the 12-week price momentum study has been improving since February.
In this daily Point and Figure chart of RIVN, below, we can see a potential downside price target in the $21 area. On the upside a rally to $33 should turn the picture bullish and generate an upside price target.
Bottom-line strategy: Traders who went long RIVN in early June should continue to hold those positions. Aggressive traders could add to longs on strength.
