Baker Hughes Incorporated (NYSE:BHI), does a lot of stuff for Oil and Gas companies. What it is is not really that important. Just know that if people are drilling for anything they win. It is a large cap company and the chart is ready to move in the short run. But it also looks good from a longer perspective. Take a look:
The daily chart above shows the rising trend since January and most recently the move higher from that trend in mid April. That move has been consolidating in a bullish flag and targets a move to 76 on a break higher that looks to be beginning. But the stock looks great technically from a longer term perspective as well. The Monthly chart below shows it in the midst of a bearish Deep Crab, that has a Potential Reversal Zone (PRZ) at 131.87 above. That is a long way up. It is hard to get too excited about the prospect of that move with resistance at 81 and 90 higher. But keeping with the mosaic view of technical analysis the 3 Box Reversal Point and Figure Chart carries a price objective of 91. I can get a lot more excited about a potential move from 70 to 91, when the short term chart shows a catalyst to start and the longer views are pointing higher.
Trade Plan:
I bought the stock just under 70 and collared it with a July 70/67.5 Put Spread and July 75 Call for free. The company reports July 18th before the market opens, the same day that the options expire. On a run higher I will adjust it up.
Disclosure: The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.