Follow the Charts, Not the Science, With This Medical Device Maker
Let's check the pulse of Boston Scientific.
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In my last review of Boston Scientific Corp. BSX back on March 12 I wrote that "Aggressive traders could probe the long side of BSX on a pullback to the $65 area. Risk to $62."
In light of the big decline in DexCom DXCM FridayI thought it might be a good idea to check on BSX again.
On Wednesday BSX beat top-line and bottom-line estimates and raised their 2024 outlook.
In the daily bar chart of BSX, below, I can see that the shares have made a strong advance since October. Prices traded above the rising 50-day moving average line since November but in July the rally has slowed down and BSX has been testing this moving average line. The slope of the 200-day line is positive and it intersects down around $65.
The daily On-Balance-Volume (OBV) has a positive trend but has leveled off in recent weeks. The trend-following Moving Average Convergence Divergence (MACD) oscillator has declined since May and is close to the zero line.
In the weekly Japanese candlestick chart of BSX, below, the two most recent candles have me worried. The candles show both a balance between buyers and sellers with a spinning top followed by an upper shadow telling us that traders rejected the highs.
The weekly OBV line shows us weakness in the past six weeks. The MACD oscillator has crossed to the downside for a take profit sell signal.
In this daily Point and Figure chart of BSX, below, I can see that prices reached and exceeded a price target in the $60 area.
In this weekly Point and Figure chart of BSX, below, I can see that prices reached and exceeded a price target in the $65 area.
Bottom-line strategy: With many stocks opening with sharp downside price gaps it might be a good idea to take some profits on BSX.
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