Yesterday, after releasing its better-than-expected earnings report, the Abbott Laboratories (NYSE: ABT) stock rallied, making its way closer to the upper side of a short-term rising channel pattern, which has been in play from around the end of February. Although the near-term outlook looks quite promising for the buyers, we would still prefer to wait for a clear violation of the upper side of that channel, before getting comfortable with the upside.
If, eventually, we get a push through the current highest point of April, at 124.34, and also the upper side of the aforementioned channel, this may allow more buyers to join in, as such a move would increase the stock’s chances of drifting further north. That’s when we will aim for the 127.12 obstacle, or even for the 128.93 hurdle, marked by the high of February 11th. If the buying action doesn’t stop there, the next possible target could be at 130.92, which is the highest point of February.
The RSI and the MACD are both pointing higher. Additionally, the RSI remains above 50 on our 4-hour chart. Also, the MACD is now sitting above zero and continues to run above the signal line. The two indicators support the above-mentioned idea by showing positive price momentum.
Alternatively, a price-drop back below the 120.22 zone, marked by the high of April 19th, could lead to a correction lower within the previously discussed channel. ABT may travel to yesterday’s low, at 117.36, a break of which might open the door for a move to the lower bound of that channel, where a hold-up could occur.
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