Procter & Gamble, founded in 1837, is a leading multinational consumer goods company known for key products like Tide, Pampers, Gillette, and Crest, spanning personal health, personal care, and hygiene segments. As a quintessential example of consumer staples, the stock has recently attracted attention as buyers have gained control, benefiting from increased sector investments after years of relative quiet. The long period of underperformance, marked by the first oval from 2012 to 2019, followed by choppy Relative Strength (RS) readings during the 2020 selloff, has given way to a rising trend. Most recently, Procter & Gamble’s shares have entered the Favored Green Zone of the SIA Dow Jones U.S. Consumer Goods Sector Index Report at position #22. Examining the Candlestick chart, we observe a stealthy breakout over the past year, even as market attention was fixated on the Electronics, Semiconductors, and the Magnificent 7. The Average Directional Index (ADX), set at a 30-day sensitivity, shows momentum building once again, reminiscent of the ADX configuration in 2019 when shares experienced a measured move (see green boxes). The ADX is a technical indicator that complements price trend analysis, helping investors gauge trend strength. Investing in a strong trend can reduce risk (Beta) and enhance profit potential (Alpha).
We have chosen the 1% Point and Figure Chart to highlight the current rapid breakout. Solid support is established at $154.14, with the latest catapult breakout occurring at $168.59. The Catapult Formation is a bullish pattern where a strong price surge is followed by consolidation, often preceded by a triple top and then a double top, signaling a significant potential upward breakout although we have circled the entire move above $154 as "the breakout." Resistance levels, based on vertical counts, are at $184.38 and $199.66, the latter also being a whole number psychological barrier for many equities. Procter & Gamble shares hold an SMAX score of 9 out of 10, reflecting strong performance compared to other asset classes, including Cash, Bonds, Currencies, Commodities, and International Equities.
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