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Fan Yang

Owens Corning (OC) Could be Rounding Out a Price Bottom

Owens Corning $OC was bearish in 2018 after reaching the $96 per share mark. I fell more than 50%, and found support just above $40 at the end of the year. Since then, we have seen a choppy bullish drive that could be developing rounded bottom.

OC Daily Chart

(click to enlarge)

Pattern Change:
- In 2018,m price action was persistently making lower highs and lower lows (definition of a bearish trend).
- Furthermore, price was trading under the 200-, 100-, and 50-day simple moving averages (SMA). 
- The RSI was held under 60 after it tagged 30, which reflected the maintenance of bearish momentum.
- All these patterns broke by the start of 2019. 
- Price action made a higher high and a higher low.
- Price is also climbing back above the cluster of moving averages. It hasn't cleared them but it is whipping above and below these SMAs instead of trading under them.
- The RSI pushed to 70, and was not able to fall below 30.
- Overall, we could be seeing a price bottom. 
- A hold above $50 followed by a break above $56 would confirm that and open up the $70 level. 
- Inability to hold above $45 on the other hand would put pressure back towards the $40 handle.

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