Park-Ohio (PKOH)'s Technical Outlook is Bright After Key Golden Cross
Park-Ohio Holdings Corp. (PKOH) is looking like an interesting pick from a technical perspective, as the company reached a key level of support. Recently, PKOH's 50-day simple moving average crossed above its 200-day simple moving average, known as a "golden cross."
A golden cross is a technical chart pattern that can signify a potential bullish breakout. It's formed from a crossover involving a security's short-term moving average breaking above a longer-term moving average, with the most common moving averages being the 50-day and the 200-day, since bigger time periods tend to form stronger breakouts.
There are three stages to a golden cross. First, there must be a downtrend in a stock's price that eventually bottoms out. Then, the stock's shorter moving average crosses over its longer moving average, triggering a positive trend reversal. The third stage is when a stock continues the upward momentum to higher prices.
A golden cross is the opposite of a death cross, another technical event that indicates bearish price movement may be on the horizon.
Shares of PKOH have been moving higher over the past four weeks, up 23.2%. Plus, the company is currently a #1 (Strong Buy) on the Zacks Rank, suggesting that PKOH could be poised for a breakout.
Once investors consider PKOH's positive earnings outlook for the current quarter, the bullish case only solidifies. No earnings estimate has gone lower in the past two months compared to 1 revisions higher, and the Zacks Consensus Estimate has increased as well.
Investors should think about putting PKOH on their watchlist given the ultra-important technical indicator and positive move in earnings estimates.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Park-Ohio Holdings Corp. (PKOH) : Free Stock Analysis Report
