Can Packer’s Strength Indicate a Robust Economy in the Future?

Paccar (PCAR) is a commercial truck building company that produces trucks under the Kenworth, Peterbilt, and DAF nameplates. Over the past year, the On Balance Volume (OBV) line has steadily risen as traders have bought this stock more aggressively. The Moving Average Convergence Divergence (MACD) oscillator is just above the zero line.

In the daily bar chart of PCAR, we can see that the uptrend has been progressing since July. The price has made a new high and is trading above the rising 200-day moving average. The Japanese weekly candlestick chart of PCAR shows a large sideways continuation pattern in 2021 and 2022. Prices are expected to turn upward in late 2022, and several recent candlestick patterns have shown lower shadows indicating that traders are rejecting lows.

In the weekly OBV line chart, the price gains of recent months are confirmed by the strength of the line. The MACD oscillator is above the zero line, but has recently corrected downwards. According to the daily point-and-figure chart for PCAR, there is a lower target price in the $65 range. However, if a trade is made at $73.73, it could start turning this chart positive. The weekly point and figure chart predicts an upside target price in the $90 region.

The Dow Theory relies on the Transportation Average to underpin the movement of industrial stocks. However, the strong charts of a truckmaker may also be important. Traders can risk long the PCAR to $67 at current levels, and add to long over $74. The target price is currently $90.

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