Is Procter & Gamble a Buy After Its Upgrade?

Shares of Procter & Gamble ( PG) were upgraded to “buy” by a sell-side firm but I have a different take on the price movement. In our January 19 review I recommended that “With the lower price target of $173 for PG now, I think we should change our technical strategy. Traders should look to take profits towards the $173 area. I use the word ‘towards’ as weakness in the broad market could prompt some traders to exit early.” 

 

Let’s check out the latest charts and indicators.  

 

In this updated daily bar chart of PG, below, we can see that our change in strategy in January was the right move. Prices failed around $165 several times before turning lower. Prices have tested and broken the rising 200-day moving average line. PG bounced back above the 200-day line but still trades below the declining 50-day line.

 

The On-Balance-Volume (OBV) line has been in a decline from the beginning of 2022 and tells us that sellers are more aggressive and that buyers have not been active in the most recent upside move.

 

The Moving Average Convergence Divergence (MACD) oscillator has crossed to the upside for a cover shorts buy signal but remains well below the zero line for an outright buy signal. 

 

 

In this weekly Japanese candlestick chart of PG, below, we see a bearish setup. Prices are trading around the 40-week moving average line. I do not recognize any of the common reversal patterns.

 

The weekly OBV line has declined the past three months. The MACD oscillator is pointed down after a take profit sell signal. 

 

 

In this daily Point and Figure chart of PG, below, we can see a downside price target in the $143 area. 

 

In this weekly Point and Figure chart of PB, below, we can see a $123 price target. 

 

Bottom line strategy: Sometimes fundamental analysts and technical analysts are on the same page, and sometimes they are not. The charts and indicators of PG at this point in time appear bearish to me so I would avoid purchases of PG for now.