Two names in the specialty chemical space are testing important resistance levels, and breakouts project significantly higher prices.
The daily chart of Ashland Global Holdings (ASH) shows the stock rallying sharply off its February low, and then making a series of higher highs and flat lows above support in the $110 area.
After making its most recent high in September, the stock moved down through its 50-day moving average, and back to the long-term support level which is currently being reinforced by the 200-day average. The bounce off this support line this week is now testing a zone of resistance between the $116 and $115 level, which includes the 50-day moving average.
Moving average convergence/divergence is making a bullish crossover, and the relative strength index has crossed above its 21-period average and center line. These readings reflect an underlying improvement in momentum.
During this last consolidation phase, Chaikin money flow has moved higher and is attempting to enter positive territory, and the money flow index, a volume-weighted relative strength measure, has crossed above its 21-period average and center line.
If the pattern of higher highs repeats, a break above the resistance zone projects above the previous September high.