Verizon Communications (VZ) : "That's a good business with a good balance sheet. I say buy, buy, buy." That is what Jim Cramer said to a caller during the Lightning Round of his Mad Money program Thursday night.
In this daily bar chart of VZ, below, we can see a long and potentially very powerful ascending or rising triangle pattern. Prices have been testing $61-$62 a number of times in the past year and now it looks like prices are ready for an upside breakout. VZ rallied in August and September, and so far in October prices have made only a shallow pullback or correction. VZ is positioned above the rising 50-day moving average line and the rising 200-day moving average line.
The On-Balance-Volume (OBV) line has turned up from the middle of August to confirm and support the bullish case.
The Moving Average Convergence Divergence (MACD) oscillator is currently in a take profits sell mode but the two moving averages that make up this indicator have begun to narrow and that can precede a bullish crossover to an outright buy signal.
In this weekly bar chart of VZ, below, we can see the large triangle pattern. Prices are above the rising 40-week moving average line.
The weekly OBV line has turned upwards and so has the MACD oscillator. VZ looks like it is ready for a decisive upside breakout.
In this Point and Figure chart of VZ, below, the price action is easier to read because the small jiggles are eliminated. A trade at $60.42 will be a new high for the move up and refresh the upside. A price target around $71 is being projected.
Bottom line strategy: We have favored the long side of VZ in the recent past so consider this buy recommendation as adding to longs. Go long or add to longs at $60.42 or higher. Raise sell stops to $75 for now. The lows $70s is our next upside price target.
