M'm M'm Good... Campbell Soup's Charts Improve Ahead of Earnings

Campbell Soup Co. (CPB) is scheduled to report fiscal second-quarter results this Wednesday. In my previous review  last Dec. 16 of the charts of the iconic food company I wrote, "CPB has found support around $40, so a stop below $40 is our risk. Traders could go long CPB near $43. The $48-$51 area is our price target for now. Strength above $53 will be very bullish."

With Campbell's earnings on the front burner, let's check its charts again.

In this daily bar chart of Campbell, below, we can see that CPB rallied into md-January and pulled back to a higher low. CPB is now trading above the rising 50-day moving average line and above the bottoming 200-day moving average line. The level of the trading volume looks to be a bit more active since December as investors are attracted to the stock. The On-Balance-Volume (OBV) line is showing improvement from early December, telling us that buyers of the food company are more aggressive. The Moving Average Convergence Divergence (MACD) oscillator has turned upward to a new outright buy signal.

In this weekly Japanese candlestick chart of CPB, below, we can see positive developments since our last review. Prices are above the 40-week moving average line. There is a long lower shadow made in February as traders rejected the lows. The OBV line improved last month and the MACD oscillator is bullish now.

In this daily Point and Figure chart of CPB, below, we can see an upside price target in the $58 area.

In this weekly Point and Figure chart of CPB, below, we used a five-box price reversal filter. Here the chart shows us a $60 price target. A trade at $52.04 will refresh the uptrend.

Bottom line strategy: Traders who went long CPB from our December review should continue to hold those positions. Raise stops to $42 from below $40. Add to longs above $47. The $58-$60 area is our price objective.

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