Clorox Co. (Friday’s close US$159.56) rallied from US$86.03 in August, 2014, to US$140.47 in July-2016 (A-B) above its rising 40-week Moving Average (40wMA). In 2016, it fell below its average and settled in a large, bullish technical pattern known as a “W” formation (dashed lines).
The recent rise above the top of this pattern signalled a breakout, renewed investor interest and the start of a new up-leg (C).
Clorox is currently in the midst of a minor correction and has good support near ±US$145 but only a sustained decline below US$145 would be negative.
Point & Figure measurements provide targets of US$175 and US$190. The large “W” formation (dashed lines) supports higher targets.
Monica Rizk is the senior Technical Analyst and Ron Meisels is the president of Phases & Cycles Inc. (phases-cycles.com). And he tweets at @Ronsbriefs. They may hold shares in companies profiled.
Chart source: decisionplus.com