Shares of Teradyne, Inc. (TER) were pulling back Wednesday. Should traders use this correction to become a buyer or is there a trend change happening? Let's check out the chart of this manufacturing automation company.
In this daily bar chart of TER, below, I can see that prices have pulled back to retest the rising 50-day moving average line. Prices are comfortably above the rising 200-day line at this point in time. The trading volume looks like it has been more active in the past three months.
The On-Balance-Volume (OBV) line has been stalled in the past month. The Moving Average Convergence Divergence (MACD) oscillator is still above the zero line but has been correcting since the middle of June.
In this weekly Japanese candlestick chart of TER, below, I see a mixed picture. Prices have made a base pattern the last twelve months or so but in recent weeks I can see upper shadows on the candles telling me that traders have rejected the highs.
Prices trade above the rising 40-week moving average line. The OBV line remains in an uptrend from October. The MACD oscillator is bullish but narrowing.
In this daily Point and Figure chart of TER, below, I can see a nearby upside price target of $119. A trade at $104 could weaken this picture.
In this weekly Point and Figure chart of TER, below, I can see a potential longer-term price target in the $158 area.
Bottom line strategy: I think the charts of TER are constructive but traders should wait for strength above $114 before going long.
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