TheStreet's quantitative service has just upgraded Toll Brothers Inc. (TOL) to a Buy recommendation. So, let's check out the charts.
In this daily bar chart of TOL, below, we can see that prices are testing the February highs. TOL is trading comfortably above the rising 50-day moving average line. The 200-day moving average line has a positive slope and we can see in early August a bullish golden cross of the 50-day line and the 200-day line.
The On-Balance-Volume (OBV) line moved sideways from May, but is now close to making a new high for the move up. A rising OBV line tells us that buyers of TOL are acting more aggressively with heavier trading volume being executed on days when TOL closes higher. The trend-following Moving Average Convergence Divergence (MACD) oscillator has turned upwards to a fresh outright-buy signal.
In this weekly bar chart of TOL, below, we can see a bullish picture. Prices are trading above the rising 40-week moving average line. A new weekly high close looks likely. The weekly OBV line is pointed higher and confirms the price strength so far this year. The MACD oscillator is very bullish with now sign of narrowing.
In this daily Point and Figure chart of TOL, below, we can see the recent upside breakout at $49 and the $83 price target.
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Bottom line strategy: The charts of TOL have improved a lot since our last review in early April. Traders could go long TOL at current levels, risking a close below $43. The $83 area is our potential upside price target.
