Conclusion, Investment Implications, Strategy

The Travelers Companies, Inc. (TRV) appears to be resuming its July 2020 major uptrend amid quarterly relative performance versus the benchmark S&P 500 (SPX).  A sustained rise above the $144.84 area would help confirm this and target an additional 13% rise to $170.00 per share.  This is an Asbury Momentum trade idea.

Analysis and Rationale

The Travelers Companies, Inc. (TRV), through its subsidiaries, provides a range of commercial and personal property, and casualty insurance products and services to businesses, government units, associations, and individuals in the United States and internationally. The company operates through three segments: Business Insurance, Bond & Specialty Insurance, and Personal Insurance. The Travelers Companies, Inc. was founded in 1853 and is based in New York, New York.

The upper panel of Chart 1 below plots TRV daily since October 2020 along with its 200- and 50-day moving averages, widely-watched major and minor trend proxies.  The lower panel displays a corresponding daily relative performance chart of TRV versus the benchmark S&P 500 (SPX, blue) along with its 63-day moving average (green, quarterly, our Strategic time period).

Chart 1

The rightmost green highlights in the upper panel show that TRV appears to be resuming its July 2020 major uptrend, as defined by its 200-day MA, following three successful tests of the 50-day MA on Jan 5th,  Jan 29th, and Feb 19th.  Meanwhile, TRV’s current trend of quarterly relative outperformance versus SPX as shown in the lower panel also appears to be resuming following consecutive tests of it on those same dates.  A sustained rise above the 50-day MA, currently situated at $141.72, would help to confirm this and would target an additional 13% rise to $170.00 per share. 

Table 1 below shows that considering the aforementioned upside target and a protective stop placed below the $144.84 area, a long entry price of $150.97 would provide a 1:3.1 risk/reward ratio (risking $1.00 to make $3.10) with an initial risk of 4.1%.

Table 1

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Please consult the table showing our Asbury 6 key market metrics to help determine if this investment is suitable for you.