Updating My Bullish Price Targets for Phillips 66
Now that my previous price target has been exceeded we need to go back to the drawing board.
You've reached your free article limit
You've read 0 of 1 free Pro articles.
In my last review of Phillips 66 PSX way back on August 11 I wrote that "PSX shares are heading higher and traders could go long at current levels. Risk to $107. The $130 area is my price target for now." I included a weekly Point and Figure chart with a price target in the $166 area.
Now that even that $166 price target has been exceeded we need to go back to the drawing board.
In the daily bar chart of PSX, below, I can see that share prices have climbed higher the past year. The shares are firmly above the rising 50-day moving average line and the rising 200-day moving average line. Prices are not extended when compared to the 200-day line.
The On-Balance-Volume (OBV) line has moved higher the past year telling us that buyers of PSX have been more aggressive than sellers. The Moving Average Convergence Divergence (MACD) oscillator is in a bullish alignment above the zero line.
In the weekly Japanese candlestick chart of PSX, below, I can see a bullish picture or setup. The shares trade above the rising 40-week moving average line.
The weekly OBV line is in a move higher. The MACD oscillator is bullish too. The candles show no hint of a reversal right now.
In this long-term monthly bar chart of PSX, below, I can see a multi-year consolidation pattern around the $100 area. Many times I have seen stocks reach price targets that are multiples of a consolidation level. For PSX that would mean $200 or even $300 are potential long-term targets.
In this daily Point and Figure chart of PSX, below, I can see a price target in the $258 area.
In this weekly Point and Figure chart of PSX, below, I can see the same price target of $258 — the same as the daily chart above.
Bottom-line strategy: Traders who are still long PSX should continue to hold those positions. Traders looking to purchase new shares of PSX or add to existing longs could do so at current levels. Risk to $150 now. The price targets are now $200, $250 and perhaps $300.
Employees of TheStreet are prohibited from trading individual securities.