Is $DE going Electric? The stock sure is! Here’s what Scott’s looking for.- February 8, 2022
DE
This is Scott with your Chart of the Day. I want to take a look at a chart that a lot of people are talking about in the stockmarketmentor.com forum today, it’s Deere ( NYSE: DE ). Now, John Deere, obviously, as you know makes tractors and lawn mowers and all this stuff.
There was some news out today that they have acquired a majority stake in a leading battery technology company called Kreisel Electric. This is really important because, as you know, if the world is going to go green we are going to need lawn mowers and tractors and stuff like that to come along with us.
The stock had a nice pop today coming on higher than average volume, that’s good. As it stands right now, in my opinion, the stock is a little extended from the moving averages. But here’s what I like about this chart if I flip to the weekly chart and zoom in a bit you can see Deere ( NYSE: DE ) has basically been going sideways for almost 11-months, and we stopped today at a previous level of weekly resistance.
I like this long base of consolidation on the weekly chart and potentially a chance to make a weekly higher high. I will say that they do have earnings coming up in just a couple of days, like next week its earnings. I wouldn’t front-run this stock right here, right now, I guess for a short-term trade you would be okay but you don’t really have a really nice buffer leading into earnings.
What I want to see from this stock is a weekly higher high and then I want to see it establish a weekly higher low. If we can do that, we can potentially, then, look for an entry here on the daily chart closer to these moving averages. So I want to see the stock break out and then kind of drift back down to the moving averages here and bounce off of that 8-day exponential period moving average. If it can do that it could give you a low-risk entry on a potentially trend-changing stock because it is coming out of this 10-month base of consolidation.
That’s what I will be looking for here over the next week or so on John Deere or Deere & Co ( NYSE: DE ). I think it is worth adding it to your watch list and seeing what the earnings reaction is, and if the stock can bounce nicely off some clear levels of support. That’s what I will be watching here on DE ( NYSE: DE ).
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