Expect More Fireworks for Plains All American

Plains All American Pipeline, L.P. PAA operates a supply and logistics fleet that includes tankers, barges, transport tugs, trucks and trailers, and rail cars. The charts of PAA are all pointed higher, so they must be doing some right, in addition to a yield of 6.85%.

Let's check the charts.

In this daily bar chart of PAA, below, I can see how buyers of PAA stepped up and bid for PAA whenever it approached the rising 200-day moving average line. Dips in December, March and June have all been buying opportunities. The slope of the 50-day moving average is positive and so is the 200-day line. The On-Balance-Volume (OBV) line shows a rising trend and tells us that buyers of PAA have been more aggressive than sellers. The Moving Average Convergence Divergence (MACD) oscillator is back above the zero line for a fresh outright-buy signal.

In this weekly Japanese candlestick chart of PAA, below, I can see that prices have trended higher the past three years. The slope of the 40-week moving average line is positive. Tests of the 40-week line have been buying opportunities. The weekly OBV line shows us a positive trend. The MACD oscillator has been above the zero-line for much of the last three years.

In this daily Point and Figure chart of PAA, below, I can see a price target in the $21 area.

In this weekly Point and Figure chart of PAA, below, I used a five box reversal filter and here the software shows us a $25 price target.

Bottom line strategy: In my Aug. 1 review of PAA I wrote that "PAA could move higher in the weeks ahead but I see some signs that a correction could unfold. Traders who are long should raise stop protection to $13.90. On the upside I have Point and Figure targets of $17 and $19. Scale-up profit-taking might be a good idea."

Prices reached my $19 target and corrected. Traders could rebuy PAA at current levels looking for $25.

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