Could The Philip Morris Stock Push A Bit Further North?

by Darius Anucauskas
11:27, 2020/06/04

Since the sharp sell-off in the beginning of March, the Philip Morris International Inc. stock (NYSE: PM) managed to recover some of its losses. Looking at the technical picture on our 4-hour chart, we can see that from the end of May, the share price is trying to overcome the 200 EMA and the 74.60 barrier, marked near the highs of May 28^th and June 3^rd. Additionally, the stock is still balancing above a short-term tentative upside support line taken from the low of March 23^rd, which adds a bit more positivity into the near-term outlook. That said, in order to aim for slightly higher areas in the near term, a break of the 74.60 barrier would be needed, hence why we will take a cautiously bullish approach.

A strong move above the 74.60 zone, would also place the share price above the 200 EMA and confirm a forthcoming higher high. More buyers could join in and help lift PM a bit higher. The next obstacle on the way up could be at 76.14, a break of which may clear the path to the 78.43 level. That level marks the highest point of April, which might stall the acceleration for a bit.

The RSI and the MACD on our 4-hour chart are currently somewhat in support of our cautiously-bullish approach. The RSI is slightly on the flat side, however remains above 50. The MACD, although it is currently flat and fractionally below its trigger line, the indicator remains comfortably above zero.

Alternatively, if the stock suddenly falls sharply below the aforementioned upside line and also drops below the 69.50 hurdle, marked by the low of May 22^nd, this could clear the way to some lower areas. Such a move might spook new investors from entering anytime soon, which may cause PM to drift further south. The share price could then move to the 68.04 obstacle, a break of which could set the stage for a slide to the 66.80 level, marked by the lowest point of May.

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