Charts. Let's Get To It...

A few chart requests from readers

Charts. Let’s get to it…

Instead of doing one long report, I’ve decided to break these into 2-3 reports over the week based on ticker submissions.

Thank you for all of you who submitted.

I have some new subscribers from a couple different countries…kinda cool. That just means more people in the country have nothing better to do than read my reports. Lol

Okay, here we go…………

1. INMD - InMode

No lines. No bias. Daily chart - Uptrend, downtrend…chop sideways.

Added: 150 day moving average. Trend reversal? Trend reversing from bearish to bullish. Price riding the moving average. Looking good.

Zoomed in a bit. Price bouncing within a wedge pattern and hitting the upper resistance zone (red arrows). Price also respecting the rising trend line (green arrows). Price is in a zone, no man’s land. Bias is bullish as long as the rising trend line holds. Price needs to confirm once we break above. Prior resistance (red arrows) becomes new support.

I like it…but I’m waiting to see which way price resolves. My bias is up.

2. MODG - Topgolf Callaway Brands

No lines. No bias. Daily chart. What does the eye see?

Added: 150 day moving average. Trend appears to be reversing. Price has moved 24% off the moving average in the bullish direction to $26. So far, I like.

Price was in a clear downtrend for a year (blue channel) then changed trend and started making higher highs and higher lows. I still like this.

Zoomed in a bit. Price testing the resistance (yellow arrows) area then clearing above it and re-testing to a potential support zone around $23. Former resistance now becomes support. If this area can act as new support, I’m a buyer. Boom.

Yes, I just said boom.

3. NOC - Northrop Grumman

Chart of Northrop Grumman since the covid low in 2020. What do we see? Price steadily moved up…then something happened. November 2022 something happened. Price dropped big. That’s not good.

Interesting chart though…lots going on. Let’s take a look at the next chart…

Same chart but going back a little further in time, Feb 2018. You can see price kept hitting its head on up trending resistance (yellow arrows). Every time price hit, it sold off…until it didn’t.

In Feb of 2022, price broke above sharply which is a bullish indicator. After the breakout, price came back and RE-TESTED the breakout zone (VERY common on true breakouts). Why is this important? It confirms the prior resistance as current support…meaning price is free to move higher. This would have been a GREAT entry point.

Let’s take a look at the next chart…

Let’s zoom into the breakout zone since March of last year. Once price broke above, it chopped higher within the perfectly parallel channel to a high of $556 (upper yellow arrow). It ultimately came down to the lower rail of the channel and GAPPED down to an intermediate low of $431…on HEAVY volume. Not good.

So where does price go from here?

Let’s look at the last chart…

Remember that chart with the rising white trendline? Well that’s still support as shown by recent price action.

We also have a gap at $485 that will most likely get filled at some point.

Does it appear strong and ready to make new highs? No.

I see no obvious opportunity here. Price might run to the gap fill at $485 before pulling back or it may come back and touch the support line in the $440 area.

LONG term, we are still in an uptrend. Below is the weekly chart of NOC since 2010. From a fundamental standpoint, I also see no reason why defense stocks would not be a great opportunity in the current state of our world.

That’s all for today. CPI just came in a little higher at 6.4% YoY, higher than the 6.2% expected. Let’s see how this all plays out.

Thanks for reading.

Eric