Many insurance companies have had a great ride higher in the stock market in 2016. But Prudential Financial (NYSE:PRU) is not one of them. Although the price is up off of a February low near 57, it is just getting back to the December 3, 2015 high level. Unchanged for 2016. Despite that under-performance now looks like it may be exactly the right time to buy this stock.
The chart below shows why. The entire price action in 2016 has been in a tightening ascending triangle pattern. Thursday sees the price peeking over the top of that triangle, attempting to fill the gap down from the first day of the year.
Continuation here gives an upside target of over 103. The triangle break pattern is most effective and powerful after 5 touches and about 2/3 of the way into the apex. At 7.75 points wide the price is 63% into the apex right now.
The chart also has a Golden Cross, with the 50 day SMA crossing up through the 200 day SMA that happened in the beginning of September. And the price is above both SMA’s. At the top of the chart the RSI continues to trend higher in the bullish zone and the MACD at the bottom is drifting higher.
Triangle break, Golden Cross, bullish and rising RSI and MACD positive and trending up. 4 reasons to ride this stock higher.
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