Yesterday, we looked at Daily Price Chart and an OBV line for ServiceNow, Inc., noting that the stock’s OBV line is sloping up.
Today’s Chart of the Day is a daily price chart for DaVita Inc. (NYSE: DVA).
DaVita Inc. provides kidney dialysis services for patients suffering from chronic kidney failure or end-stage renal disease (ESRD).
The company operates kidney dialysis centers and provides related lab services in outpatient dialysis centers. It also provides outpatient, hospital inpatient, and home-based hemodialysis services; owns clinical laboratories that provide routine laboratory tests for dialysis and other physician-prescribed laboratory tests for ESRD patients; and management and administrative services to outpatient dialysis centers.
Now, below is a Daily Price Chart with the 50-Day Exponential Moving Average (EMA) and 100-Day EMA for DaVita Inc.
Back on July 24, 2019, the DVA 50-Day EMA (blue line) crossed above the 100-Day EMA (red line). This indicated DVA was showing a ‘buy’ signal (circled).
When the 50-Day EMA crosses above the 100-Day EMA, the stock’s buying pressure has begun to outweigh the selling pressure, signaling a ‘buy’ signal.
When the 50-Day EMA crosses below the 100-Day EMA, the selling pressure has begun to outweigh the buying pressure, signaling a ‘sell’ signal.
- 50-Day EMA line Above 100-Day EMA = Buy signal
- 50 Day EMA line Below 100-Day EMA = Sell signal
The Potential for Profits
If you had purchased DVA shares when the 50-Day EMA crossed above the 100-Day EMA on July 24, 2019 – when the stock was around $59.00 – you’d be up 49.9% by now.
Not a bad profit for a yearlong hold of a major healthcare services company.
Now, as you can see, the 50-Day EMA is still above the 100-Day EMA. That means the bullish trend is still in play!
As long as the 50-Day EMA remains above the 100-Day EMA, the stock is more likely to keep trading at new highs in the coming days and weeks.
We’ll be keeping our eye on this stock as it continues to trend upward.
Additionally, we’d like to talk about how a previous Chart of the Day stock has done…
The Power of Options
On July 14, we highlighted K12 Inc. (NYSE: LRN), noting that LRN’s OBV line was sloping up, validating the stock’s bullish trend.
If you happened to have purchased LRN shares on that day, you’d already be up 33.9%.
But… if you had purchased the right option contract, you would be up 187.4% in just two weeks’ time!
That’s the power of options.
Editor, Chart Of The Day