The relative strength performance of pharmaceutical and personal products producer Johnson & Johnson (JNJ) over the last fifteen years provides a textbook example of the relative strength profile for a low-beta defensive stock. JNJ has spent most of the last 15 years bouncing around between the red and yellow zones of the SIA S&P 100 Index Report, particularly during times when the market was doing well and its performance as a mature, stable stock lagged that of high flyers on a relative basis.
Johnson & Johnson has spiked up in the rankings several times over the last decade and a half, most of which have coincided with times of market turmoil including 2008, 2011, 2016, 2018, and 2020. This year, JNJ has been climbing up the rankings once again and yesterday it returned to the Green Favored Zone for the first time since March of 2020. Yesterday it finished in 26th position, up 4 spots on the day and up 10 places in the last month.
Since the March 2020 market bottom, Johnson & Johnson (JNJ) has been consistently climbing through a series of rallies followed by periods of consolidation in higher ranges. Through late 2021 and the start of this year, JNJ had been consolidating between $155 and $175, more recently, this has shifted up into a $165-$185 range with additional support possible near $160.
A close above $185 would signal the start of a new upleg with next potential resistance in the $195-$205 area, based on measured moves and the $200 round number.
Since the March 2009 market bottom, Johnson & Johnson (JNJ) shares have been under steady accumulation, advancing in a step pattern of rallies followed by periods of consolidation at consistently higher levels. The only notable speed bump along the way was the March 2020 market crash.
Through 2021 and into this year, JNJ has remained under accumulation, continuing its upward trend of higher lows. Back in April, the shares peaked near $186.65, a level that has emerged as initial resistance, and the shares have reversed four rows. Although a bearish High Pole Warning has been triggered, it has been small so far and the shares remain in an overall uptrend above support near $162.50 and $156.15 near previous column highs and lows. A breakout to the upside from the current consolidation range would signal the start of a new upleg with next potential resistance in the $200.00 to $202.00 area between a round number and a vertical count.
With a bullish SMAX score of 9, JNJ is exhibiting strength against the asset classes.
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