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From a technical perspective, the stock chart for Loblaw Companies Ltd. (L-T) is positive, recently displaying a bullish "golden cross" pattern.

A "golden cross" occurs when a short-term moving average, in this case, the 50-day moving average, crosses above a longer-term moving average, the 200-day moving average in this case. When this occurs, it marks a potentially positive signal, suggesting the upward price momentum may have traction.

Many traders suggest waiting until the 50-day moving average crosses above the 200-day moving average by a certain percentage, such as 3 per cent, to confirm the bullish signal. With respect to Loblaw, the rising 50-day moving average (at $73.37) is 4.5 per cent above the rising 200-day moving average (at $70.21).

Also positive, the share price finally broke above a major resistance level around $74. This move higher broke the stock out of a trading range. Since mid-2015, the share price has been consolidating, or trading sideways, in a range principally between $64 and $74.

From a fundamental perspective, the majority of analysts are positive on Loblaw. There are 10 analysts with buy recommendations and four analysts have hold recommendations (from Accountability Research, Eight Capital, Morningstar, and Scotia Capital). There are no sell recommendations.

Analysts typically value the stock using a sum-of-the-parts methodology. The consensus 12-month target price is $83.54, implying the share price has nearly 8-per-cent upside potential.

Steady growth is forecast for the company. The Street is expecting earnings per share of $4.42 for 2017, up 9 per cent from $4.05 reported in 2016, with earnings anticipated to rise another 9 per cent to $4.83 in 2018.

On the recent earnings conference call, chief financial officer Richard Dufresne provided a positive outlook stating, "In 2017, we expect to deliver positive same-store sales growth for the year and stable gross margin in the retail segment despite the current deflationary environment and the continuing negative pressure of health care reform. We expect to further improve our efficiencies in 2017 though not at the same level experienced in 2016. We also plan to grow adjusted net earnings and allocate a significant portion of free cash flow to share repurchases."

If we see continued downward pressure in stock markets, this defensive stock may retain its value relative to other stocks. On a pullback, there is initial support between $74 and $75. Failing that, there is support around $70.