These 10 stocks were the top performers in the S&P 500 in May. After examining their respective technical footings to see which ones had the best shot of building on those gains, I found four stocks that I favor now.
Prices are now above the rising 50-day simple moving average line. The declining 200-day average is still above the market. The on-balance-volume, or OBV, line, which goes up if the volume of trading is heavier on days when Williams closes higher, has moved up from a February low, with better gains seen in April and May. The 12-day momentum study is not flashing any divergence warnings.
This weekly chart, below, of WMB shows that the stock has plenty of room to advance before encountering any chart resistance.
The OBV line has improved on this timeframe, and the moving average convergence/divergence oscillator is moving up toward the zero line for a possible outright buy signal.
Dun & Bradstreet
This daily chart of Dun & Bradstreet (DNB) is very impressive -- not just for the gains in the month of May but also for the gains from the February low.
Prices are above the rising 50-day moving average line and the flat to turning up 200-day average. The 50-day has also rallied above the 200-day in May for a "golden cross" buy signal. The OBV line was flat in March and April but began a rise in May. We can also see that volume was heavier in May. The momentum study in the lower panel shows increasing momentum with the price gains.
In this weekly chart of DNB, below, we can see that nearly all of the 2015 losses have been recouped.
Prices are above the rising 40-week average line. The OBV line on this timeframe has made a new high for the move up (very bullish). And the MACD oscillator generated a new go-long signal when it moved above the zero line.
Look for Dun & Bradstreet to test its 2015 highs in the weeks ahead.
Oneok (OKE) - Get Report made a three-month bottom on this daily chart, above, and then broke out on the upside and has more than doubled in three months. Notice the strongly rising OBV line and the golden cross of the moving averages at the beginning of May. Momentum has been weakening since the end of April but it hasn't been a drag on the rally.
In this weekly chart of OKE, below, we can see that OKE is making a comeback from its big decline.
The OBV line on a weekly time frame has been "super strong." The MACD oscillator is firmly above the zero line, with no sign of narrowing. OKE has pushed up more than halfway through a resistance area ($40-to-$50) and is likely to go all the way through it.
Electronic Arts (EA) - Get Report had powerful month of May, gapping to the upside and probing its 52-week highs. The 50-day and 200-day moving averages are generating a golden cross as we enter the month of June. The OBV line moved up with prices, and momentum has not diverged.
This longer-term weekly chart of EA, above, is just as impressive as the daily chart. Prices are pushing up into new high ground. The OBV line is positive, and the MACD oscillator is in a bullish configuration.
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