Garmin Ltd. (GRMN) is a leading manufacturer of information-providing devices used for communication and navigation. The stock closed Friday, Feb. 16, at $65.21, up 9.5% year to date. The stock managed to avoid a full-fledged correction when it traded as low as $59.17 on Feb. 6. In fact, the stock set its all-time intraday high of $65.51 on Friday.
Analysts expect Garmin to deliver earnings per share of 75 cents when the company reports results before the opening bell on Wednesday, Feb. 21. Garmin is expected to report strong results in its marine, aviation and outdoor segments, but the company could show drags in its fitness and personal navigation devices. (See also: Garmin Unveils a New High-End Fitness Watch.)
The daily chart for Garmin
Although it is not shown on the daily chart, Garmin stock has been above a "golden cross" since April 5, 2016, when the stock closed at $40.05. A "golden cross" occurs when the 50-day simple moving average moves above the 200-day simple moving average, indicating that higher prices lie ahead. This tracked the stock to its all-time intraday high of $65.51 set on Feb. 16. The horizontal lines show that my semiannual value level lags at $55.12. The stock is above my annual, monthly and quarterly pivots of $61.60, $61.48 and $63.77, respectively. Above the chart and not shown is this week's risky level of $66.97.
The weekly chart for Garmin
The weekly chart for Garmin is neutral despite the stock setting a new high on Friday. The stock is above its five-week modified moving average of $62.31 and above its 200-week simple moving average at $49.03, which is the "reversion to the mean" last crossed during the week of July 15, 2016, when the average was $44.41. The 12 x 3 x 3 weekly slow stochastic reading declined to 75.94 last week, down from 78.37 on Feb. 9.
Given these charts and analysis, I recommend buying Garmin shares on weakness to my annual and monthly pivots of $61.60 and $61.48, respectively, and reducing holdings on strength to my weekly risky level of $66.97. In between is my quarterly pivot of $63.77. My semiannual value level lags at $55.12. (For more, see: Garmin Debuts 3 New Wearables at CES.)