by Shane Ormond
On Feb 20, 2020
Shares of Groupon and Blue Apron tanked yesterday after their quarterly reports reignited skepticism about the companies’ “unconventional” business models. (And by “unconventional” I mean “doesn’t work.”)
Blue apron, groupon, e-trade, morgan Stanley
Blue apron, groupon
Yesterday, we looked at a Daily Price Chart of Leidos Holdings, Inc. and noted that the stock had been making a series of higher highs and higher lows.
Today’s chart is a brand-new technical indicator. We’ll be looking at Visa, Inc, (NYSE: V).
Now, the Daily Price Chart below shows that V is in a price uptrend. We can see that easily.
The current price of V is trading higher than it was exactly six months ago. The On Balance Volume (OBV) Chart is shown directly below the Daily Price Chart.
Here’s what you need to know about the OBV Line: it measures how much volume is either pushing the stock up, or down. Meaning, the volume of stock that’s being sold or bought.
Using a stock’s volume in this way can confirm an uptrend by reflecting that more people are buying the stock than are selling it. Take a look at the chart below…
We can see from the OBV chart shown above that the On Balance Volume Line for Visa is sloping up.
This indicates that the volume is heavier on up-days and buying pressure is exceeding selling pressure.
Buying pressure must continue to exceed selling pressure in order to sustain a price uptrend. So, the OBV Line is a simple indicator to use that confirms the price uptrend and its sustainability.
We’ll be sure to keep following Visa Inc., as the stock’s buying pressure exceeds it’s selling pressure and the price uptrend continues.
Maximizing Our Profit Potential
Additionally, we’d like to talk about how a previous Chart of the Day stock has done…
On January 31st, we highlighted Mastercard (NYSE: MA), noting that MA stock had retraced after a period of being overbought, offering a prime buying opportunity.
If you happened to have purchased MA shares on that day, you’d already be up 2.49%.
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Editor, Chart Of The Day