Chart of the Week: Visa
Good morning everyone. Happy Wednesday. It’s time for our chart of the week. And this week we’re gonna be focusing on big credit card company Visa. There aren’t a lot of charts out there that are looking bullish here, but this is one of the few that actually has my eye here, especially if it pulls back a little bit to support.
Let’s take a look at the Visa chart on the left hand side.
So you can see a nice series of higher highs and higher lows. That up-trending line tells us that this stock is bullish still. We recently had a breakout on really strong volume to a new all-time high.
We do have, of course, the relative strength still overbought here. But notice that overbought here – it lasted for about a month and pulled right back down and gave an opportunity to add the stock.
Now remember something I say quite often: The best trends barely gave you a chance to get on board. And this one actually gave you a chance to get on board when it pulled back to this 20 day moving average. This is the dotted line right here.
Chaikin money flow has been very strong – notice this. This has been fantastic all the way up form the end of November to the most recent end of February.
MACD pulled back down for a minor sell signal, but now it’s crossing back over. We had that strong volume on Friday the 28th.
But here’s an indicator that I wanted to share with you guys. I haven’t shared this too much with you in the past couple of years. This is called the on-balance volume. This is really basically where we see where the big institutions are placing their money. This is an indicator that was created about 40 – 45 years ago by Joe Granville.
On-balance volume is a great way to identify where that big money is flowing. When you see this accumulation of higher highs and higher lows in this indicator, even when we pull back, this tells you that those pullbacks are buying opportunities.
So if we do pullback in Visa, maybe back to this 20 day moving average, let’s call it about $350 – 352, I’m a buyer right there. Take a look at this.
It is a little bit extended at this point. We did have a DOG come out on Monday, March 3. So again, and the market remains weak. No question that Visa is going to get hit as well, too. But it could be that nice buying opportunity that you’re looking for.
So that’s Visa; symbol V.
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