Verizon Communications (VZ) has been a disappointment to buyers, especially since March. Prices have tumbled lower and a juicy dividend has not stopped the slide lower. Let's check out the charts and indicators.
In this daily bar chart of VZ, below, we can see that prices plunged in April and rebounded temporarily in May and June before sinking again in July. VZ is trading below the negatively sloped 50-day and 200-day moving average lines. The trading volume has increased on the declines as traders vote with their feet.
The On-Balance-Volume (OBV) line has weakened for the past 12 months and tells us that sellers of VZ have been more aggressive than buyers. The Moving Average Convergence Divergence (MACD) oscillator is bearish.
In this weekly Japanese candlestick chart of VZ, below, we can see that prices have been in a long "ski slope" lower. Prices are trading below the bearish 40-week moving average line. The weekly OBV line and the MACD oscillator confirm the price weakness.
In this monthly bar chart of VZ, below, we can see that prices have made a serious top pattern and we might not find important (and old) chart support until the $30-$25 area.
In this daily Point and Figure chart of VZ, below, we can see a downside price target in the $37 area.
In this weekly Point and Figure chart of VZ, below, we can see a slightly lower price target of $36.
Bottom line strategy: Avoid the long side of VZ as the short and long-term charts are bearish.
(Verizon is a holding in the Action Alerts PLUS member club. Want to be alerted before AAP buys or sells VZ? Learn more now.)
