Universal Display Corp. (OLED) is up sharply today and it has broken out above its August/September highs. Breakout price action, yes, but it remains to be seen if this will also be breakout volume today. Let's check out all our charts and indicators before we rush to judgment.
In this daily bar chart of OLED, below, we can see a large double bottom-like chart pattern with a low in June and a second low in January. Prices rise an acceptable amount of points from the lows to give this pattern the right structure.
The daily On-Balance-Volume (OBV) line rises from late June to September and then again from the second low in early January. A rising OBV line tells us that buyers are acting in a more aggressive manner and that is what we want to see as a stock bottoms.
The Moving Average Convergence Divergence (MACD) oscillator crossed above the zero line in July and again in January for two respective buy signals. The height of this base pattern when added to the recent breakout gives us a potential price target of $180.
In this weekly bar chart of OLED, below, we can see that the twin lows at $80 are after a significant decline - so we have something to reverse. Prices are now above the rising 40-week moving average line and prices (not shown) are above their mid-2018 highs.
The weekly OBV line shows two lows but the turn up from November has been weak and does not confirm the price action right now.
The weekly MACD oscillator has crossed to the upside for a cover shorts buy signal and an outright go long signal could happen this coming week.
In this Point and Figure chart of OLED, below, we can see that prices met an upside price target of $128.
Bottom line strategy: Prices have indeed broken out on the upside, call me old school, but I like to see impressive volume on breakouts. Maybe in the remainder of the trading session we will see the volume turned up but at the moment of this writing I get the feeling we could see a dip this coming week to be buyer with a sell stop below today's low. If the dip is relatively shallow and volume is light I could see going long for a possible rally to the $180 area.
(OLED is a holding of TheStreet's Trifecta Stocks.)