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Clean Harbors (CLH) Now Trades Above Golden Cross: Time to Buy?

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From a technical perspective, Clean Harbors, Inc. (CLH - Free Report) is looking like an interesting pick, as it just reached a key level of support. CLH's 50-day simple moving average crossed above its 200-day simple moving average, which is known as a "golden cross" in the trading world.

Considered an important signifier for a bullish breakout, a golden cross is a technical chart pattern that's formed when a stock's short-term moving average breaks above a longer-term moving average; the most common crossover involves 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 contrasts with a death cross, another widely-followed chart pattern that suggests bearish momentum could be on the horizon.

Over the past four weeks, CLH has gained 21.8%. The company currently sits at a #1 (Strong Buy) on the Zacks Rank, also indicating that the stock could be poised for a breakout.

Looking at CLH's earnings expectations, investors will be even more convinced of the bullish uptrend. For the current quarter, there have been 4 changes higher compared to none lower over the past 60 days, and the Zacks Consensus Estimate has moved up as well.

Moving Average Chart for CLH

With a winning combination of earnings estimate revisions and hitting a key technical level, investors should keep their eye on CLH for more gains in the near future.


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