After Golden Cross, Bar Harbor Bankshares (BHB)'s Technical Outlook is Bright

Bar Harbor Bankshares, Inc. (BHB) reached a significant support level, and could be a good pick for investors from a technical perspective. Recently, BHB's 50-day simple moving average broke out above its 200-day moving average; this is 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.

A successful golden cross event has three stages. It first begins when a stock's price on the decline bottoms out. Then, its shorter moving average crosses above its longer moving average, triggering a positive trend reversal. The third and final phase occurs when the stock maintains its upward momentum.

This kind of chart pattern is the opposite of a death cross, which is a technical event that suggests future bearish price movement.

Shares of BHB have been moving higher over the past four weeks, up 12.7%. Plus, the company is currently a #2 (Buy) on the Zacks Rank, suggesting that BHB could be poised for a breakout.

The bullish case only gets stronger once investors take into account BHB's positive earnings outlook for the current quarter. There have been 1 upward revision compared to none lower over the past 60 days, and the Zacks Consensus Estimate has moved up as well.

Given this move in earnings estimates and the positive technical factor, investors may want to keep their eye on BHB for more gains in the near future.

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This article originally published on Zacks Investment Research (zacks.com).

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