This US behemoth stock is worth tracking?
10th January 2019 08:49
This healthcare brand took a major hit last month, so chartist Alistair Strang looks at the possible opportunities for investors.
Johnson & Johnson (NYSE:JNJ)
Johnson & Johnson (NYSE:JNJ) famed for their innovation in creating fireproof babies (by once apparently including asbestos in their famed baby powder) this share has thus far evaded the full wrath of the markets. In fact, quite the converse may prove true this earnings season!
The share price need only close a session above $132.5 to give an early warning of movement to an initial $144, effectively making their recent PR disaster a distant memory. Greater interest is justified, should $144 be bettered. This moves the price into territory where a longer term $152 becomes viable, along with a new all-time high.
Our interest is piqued by the drop to $121 at the end of December. We'd anticipated a visit to $118 and were surprised this level was not achieved, instead the price is experiencing a slight bounce before the target. Usually, this comes with the implication of some real strength in a price, so perhaps it shall prove worth watching fairly soon.
What happens if $118 breaks?
Travel down to an initial $104 followed by a doubtless short-lived bounce looks very possible. Should $104 break, continued weakness in the longer-term suggests a bottom eventually at $89, a point where a real bounce would be expected. The larger problem - with any moves below $118 - comes from two sources.
Firstly, there's a break of the uptrend since 2012 and secondly, the visual implication of "double top" share price peaks. This self-fulfilling prophecy risks being sufficient to drive an eventual $72, perhaps even $32 in the long-term.
Who knows, perhaps their success in appealing punitive US court verdicts shall continue.
Source: Trends and Targets. Past performance is not a reliable indicator of future results
These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.
Editor's Picks