2 Charts To Make Sense Of Du Pont's 'Volatility And Indecision'

In Eagle Bay’s most recent Dow Thirty report, founder JC Parets looked into the movement of E I Du Pont De Nemours And Co DD shares.

Below are two charts every shareholder should see.

Weekly Chart

Although Du Pont has looked quite attractive in recent years, Parets sees its type of volatility and indecision as “typical behavior for turning points and not trending markets.” This added volatility led the firm to be considerably less constructive in this market.

Parets says he hasn’t seen enough to short the stock as the firm is still “watching this support from July to signal the end of this bull run. But the more and more of this volatility we see up here, the higher the likelihood that this last move was it, at least for now.”

Parets concludes that he would “still be neutral and approach this market tactically with a shorter-term outlook."

Daily Chart

The short-term still looks quite messy. “With a rising 200-day moving average and momentum hitting both overbought and oversold conditions giving us mixed signals since the Summer, we said that a breakout above the September highs, based on the structural picture, would be an extremely bullish development.”

The firm only wanted to be long if the stock surpassed the $73 threshold, with an upside target around $78 –- representing the 161.8 percent Fibonacci extension of the September-October correction. Their $78 target was hit in March, and they continue to wait for more data before starting any new positions.