Latest news with #DavidKeller
CNBC
15-05-2025
- Business
- CNBC
Healthcare shares are under pressure lately, but one stock is separating from the pack
Investors are generally avoiding the health care sector, and for good reason. While the Health Care Select Sector SPDR Fund (XLV) outperformed the S & P 500 and Nasdaq 100 through the end of April, May has meant disaster for pharmaceutical companies following the White House executive order on lowering drug prices. With the S & P 500 and Nasdaq 100 now trading back above their 200-day moving averages, and stocks like Eli Lilly & Co (LLY) and Johnson & Johnson (JNJ) feeling the pain of regulatory pressure, it's reasonable to expect very few opportunities in this former high-flying sector. However, a quick scan for stocks in the health care sector making new three-month highs yielded a number of promising charts showing improved technical characteristics. Separating from the pack? Let's review one of those names, HCA Healthcare (HCA) , and see how improved price momentum could lead to further gains. The daily chart of HCA shows how long it took for this health care provider to eclipse its 200-day moving average. After the first test in Q1, there were three additional failed attempts to push above this long-term trend barometer. Finally, at the end of April, HCA pushed above the 200-day and has now moved up to retest the price gap from October 2024. Note how the Relative Strength Index (RSI) stalled out around 60 during earlier attempts to push above the 200-day moving average. When HCA finally pushed above the 200-day, the RSI moved above the 60 level, showing positive momentum characteristics more common in bullish trends than bearish phases. The weekly chart suggests that this recent upside breakout was the result of a larger cyclical rotation from the pullback in late 2024 to a renewed uptrend phase: The weekly PPO, shown in the bottom panel, gave a buy signal in late February as HCA was nearing its 150-week moving average. We can see a similar pattern with the PPO indicator and moving average support in Q4 2024 and Q3 2022. In each instance, a pullback to the 150-week moving average was soon followed by a PPO buy signal to signal an "all clear" and a resumption of the primary uptrend. How can we manage risk as HCA retests the price gap from late 2024? Using the Ichimoku cloud model, we can see a dramatic break above cloud resistance in March, followed by a test of cloud support at the April low: There could be further pullbacks along the way, but as long as HCA remains above this cloud support zone, the primary trend appears bullish. - David Keller, CMT DISCLOSURES: (None) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL'S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.
CNBC
01-05-2025
- Business
- CNBC
The soft drink stock forming a bullish 'cup with handle' pattern
While the S & P 500 and Nasdaq 100 remain languishing below their 200-day moving average, shares of Coca-Cola Co. (KO) are close to completing a bullish price pattern which suggest much further upside potential. The daily chart of KO displays a fairly straightforward "cup with handle" pattern, formed by a long rounded bottoming pattern followed by a short-term pullback. The key to this pattern is that the rim of the cup as well as the handle are all around the same price level. In this case, each of those points have hit in the $73-74 range. This bullish pattern is only completed if and when the price breaks above the rim of the cup, which would suggest a minimum upside target around $85. We can arrive at this upside objective by measuring the height of the pattern and then adding that amount to the breakout level around $74. As we wait for KO to complete this bullish pattern resolution, we have to note one concerning element in the form of weakening momentum. The recent swing highs have been marked by a lower RSI, forming a bearish momentum divergence. So the price action in the handle has demonstrated weaker momentum. A breakout with stronger RSI levels would erase this divergence and confirm the upside price target. On the weekly chart, we can observe a buy signal from the PPO indicator in early February. As KO bounced off its 150-week moving average, this bullish PPO signal confirmed a new accumulation phase which propelled the stock to up its current retest of all-time highs. The previous rally phase came after a PPO buy signal soon after the October 2023 low around $52. At the end of this rally phase, the RSI pushed into the overbought region which suggests a potential exhaustion point. Then in September and October 2024, the RSI came out of the overbought region just before a PPO sell signal. A similar pattern in 2025 could indicate an end to the current bullish phase, but neither signal is evident at this point. So is this bullish configuration for Coca-Cola part of a larger accumulation phase for beverage stocks? To the contrary, a quick review of the technical setup for KO versus PepsiCo, Inc. (PEP) shows that these two competitors have experienced a vastly different 2025. While KO is testing its previous all-time high, PEP is making a new 52-week low. There could be a number of reasons for this divergence, from Coca-Cola's greater exposure outside the United States, to PepsiCo's portfolio of brands that include snack foods, to a generally stronger fundamental profile for KO. In the end, the charts don't tell us why there's a divergence between the stocks, but they definitely suggest that Coca Cola is demonstrating a much stronger technical position going into May 2025. -David Keller, CMT DISCLOSURES: (None) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL'S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.
CNBC
24-04-2025
- Business
- CNBC
It may be time to scoop up this insurance stock on the dip, according to the charts
With broad disruption in the equity markets in recent weeks, it's becoming increasingly challenging to find stocks that are still above upward-sloping 200-day moving averages. Not only are shares of Progressive Corp. (PGR) still trading above this key trend barometer, they appear to be following a familiar pullback pattern that could provide an ideal entry point. Back in April 2024, after a strong four months to begin the year, PGR demonstrated a classic bearish momentum divergence. This pattern of higher highs in price matched with lower peaks in momentum, highlighted with purple trendlines, suggests weakening price momentum as shares are moving higher. As the bullish trend nears an exhaustion point, price tends to peak and then reverse lower. The stock pulled back to just below $200 and ended up retesting this support level numerous times in May and June. The RSI pulled back during this period, but remained above the crucial 40 level during this consolidation period. Eventually the uptrend resumed, with a new swing high in August 2024 confirming a new bullish phase for Progressive. We observed an almost identical set of circumstances toward the end of 2024, when the price and RSI formed another bearish momentum divergence pattern at the September peak. Again, PGR pulled back to establish a new short-term support level, and the RSI remained mostly above the crucial 40 level during the consolidation phase. Finally, a break to new highs in February 2025 signaled a resumption of the uptrend phase. We've now identified yet another bearish momentum divergence at the March 2025 peak, followed by a pullback to short-term support around $250. If this playbook would continue as expected, we'd be looking for PGR to hold price support at this important level with RSI remaining mostly above 40. We're also noting that the 200-day moving average is in play, which should provide even more support around $250. It's often helpful to triangulate signals with other technical indicators to identify a potential agreement between disparate approaches. In this case, a quick review of the Ichimoku cloud model shows that previous pullbacks have often found support within the cloud support range. If PGR would break below cloud support but find an eventual low at the 200-day moving average around $250, a break back above the cloud could provide confirmation that a new uptrend phase is in place for this leading insurance provider. -David Keller, CMT Get Your Ticket to Pro LIVE Join us at the New York Stock Exchange! Uncertain markets? Gain an edge with CNBC Pro LIVE , an exclusive, inaugural event at the historic New York Stock Exchange. In today's dynamic financial landscape, access to expert insights is paramount. As a CNBC Pro subscriber, we invite you to join us for our first exclusive, in-person CNBC Pro LIVE event at the iconic NYSE on Thursday, June 12. Join interactive Pro clinics led by our Pros Carter Worth, Dan Niles, and Dan Ives, with a special edition of Pro Talks with Tom Lee. You'll also get the opportunity to network with CNBC experts, talent and other Pro subscribers during an exciting cocktail hour on the legendary trading floor. Tickets are limited! DISCLOSURES: None All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL'S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.
