McDonald's Corp. (MCD) is expected to report their latest earnings numbers on Wednesday. Jim Cramer is bullish on it. What do the charts and indicators look like now? Let's go through the drive-through and check.
In this daily bar chart of MCD, below, we can see a choppy trading pattern. MCD traded sideways from February to the end of September before the bulls gained the upper hand. Prices rallied to a late November high followed by a pullback and then a retest of the highs last week. The rising 50-day moving average line is being tested from above and the rising 200-day moving average line intersects below $170. A bearish On-Balance-Volume (OBV) line can be seen more most of the sideways pattern in 2018 and the line moves up and down with the price action since October. A bearish divergence can be seen since November as prices made an equal high but the OBV line made a lower high. The second rally in January was on weaker volume and inherently bearish. The Moving Average Convergence Divergence (MACD) oscillator is barely above the zero line.
In this weekly bar chart of MCD, below, we can see a long-term uptrend for MCD which looks better than comfort food. MCD is above the rising 40-week moving average line. The weekly OBV line positive and the MACD oscillator looks close to new signal.
In this Point and Figure chart of MCD, below, we can see a bearish downside price target of $151 being projected. A rally to $189.74 is needed to refresh the uptrend.
Bottom line strategy: unless MCD can clearly break above its November/January peaks I would take a cautious approach for the next several weeks.