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Is it Instructive for the Overall Market that Defensive Name $KO Looks Very Promising Technically?


When I look through many chart set-ups, I see plenty of patterns that make me react "eh," but not The Coca-Cola Company (KO).

I think it is meaningful that it exhibits an 8-month, rounded-base formation, is considered a defensive name, and pays a dividend that yields 3.4% within a market that remains extremely selective in the names that it takes higher (the crowded big technology names, like AAPL, AMZN, FB, GOOG for instance).

Let's notice that earlier this week, KO popped above multi-month resistance at 43, ran to 43.78, and has since returned to its breakout plateau, which is where new buyers should indicate interest in owning the stock, if the intermediate-term, technical set-up means that KO is under accumulation for a run at 45.

That said, however, earnings are due out on April 25, which likely will be the next directional catalyst.

Based on the intermediate-term, technical set-up, my expectation is for a positive reaction to earnings, but I am not suggesting anyone enter ahead of the earnings release next Tuesday.

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