Walgreens Boots Alliance (WBA) reported better than expected earnings numbers Thursday and this may be the key for prices to break out of their 11-month consolidation. Let's check out the charts and indicators.
In this daily bar chart of WBA, below, we can see that prices have rallied strongly since early December. Prices are trading above the flat 200-day moving average line and above the rising 50-day line. The On-Balance-Volume (OBV) line has turned up with the price rally in December and tells us that buyers of WBA have been more aggressive than sellers. The Moving Average Convergence Divergence (MACD) oscillator is in a bullish alignment above the zero line.
In this weekly Japanese candlestick chart of WBA, below, we can see a large three-month base pattern. Prices are trading above the 40-week moving average line but a positive slope on the average is lacking. The weekly OBV line shows improvement since July and is close to a new high for the move up. The MACD oscillator is just crossing the zero line for an outright buy signal.
In this daily Point and Figure chart of WBA, below, we can see a potential upside price target in the $74 area. A trade at $56 is needed to refresh the uptrend.
In this weekly Point and Figure chart of WBA, below, we can also see the $74 price target.
Bottom line strategy: The charts of WBA looked bearish back on July 2 but a lot has changed in the past six months. Traders could go long WBA on strength above $56 - a new high on the Point and Figure chart. Risk to $50. The $74 area is our price target.
