Anthem Is Pointed Up but Let's Tighten Our Stop Protection

Anthem ANTM is still pointed up from a big upside price gap in late January. Better than anticipated earnings numbers were the fundamental reason for the gap and the new highs but I am going to stick to the charts and technical indicators.

In this daily bar chart of ANTM, below, we can see an uptrend from late March. Prices tested the rising 200-day moving average line in early June and again in December and January. In late January prices gapped above the bottoming 50-day moving average line.

The daily On-Balance-Volume (OBV) line is diverging from the price action this month. Prices made new highs but the OBV line has not confirmed the price action.

The Moving Average Convergence Divergence (MACD) oscillator is above the zero line but the two moving averages that comprise this indicator have narrowed and could cross to a take profits sell signal.

In this weekly bar chart of ANTM, below, we can see that prices have more than doubled in the past three years. The rising 40-week moving average line has done a great job identifying the trend.

Unlike the daily OBV line, the weekly OBV line has made a new high to confirm the price strength.

The weekly MACD oscillator has crossed to a fresh outright buy signal.

In this Point and Figure chart of ANTM, there are no gaps, no volume and no dates like our other charts. An upside price target of $441.66 is being indicated but that may be too ambitious. A decline to $296.91 could weaken this chart despite what our other indicators suggest.

Bottom line strategy: I always feel more comfortable when I have a risk level in mind. ANTM is pointed up but I would recommend a sell stop at $295.

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