Technical Analysis – Mastercard stock sets new record high; a correction is long overdue
July 25, 2023 4:29 pm
Mastercard is edging lower today after recording a new all-time high of 404.51 in yesterday’s session, just a few days before the scheduled earnings release for the second quarter of 2023. The rally since the October 13, 2022 low has been impressive, with the latest leg from the May 31 low being almost exponential and the pattern of higher highs and higher lows remaining intact.
This situation is reflected in the stochastic oscillator as this indicator continues to trade at its overbought territory and it is actually currently trying to climb again above its moving average. However, the recent all-time high has not been met by a higher high in the stochastic and thus potentially hinting at the formation of a bearish divergence. In the meantime, the Average Directional Movement index (ADX) has been retreating from its multi-month high, reflecting the gradual loss of strength of the current bullish trend.
Should the bulls still feel hungry, they could try to push the stock towards the July 24 high at 404.51 and have the chance of recording a new all-time high.
On the other hand, the bears are anxiously trying to record some sort of a pullback. They would love for a drop below the April 28, 2021 high at 400.83 and a break of the long-term October 13, 2022 upward sloping trendline. If successful, the bears could then have the chance of testing the support set by the 382.61-382.80 area, which is defined by the January 26, 2023 high and the 50-day simple moving average (SMA).
To conclude, a correction in Mastercard stock is long overdue but the bears need the support of the momentum indicators, which at the moment are still favouring the bulls.
Mastercard is edging lower today after recording a new all-time high of 404.51 in yesterday’s session, just a few days before the scheduled earnings release for the second quarter of 2023. The rally since the October 13, 2022 low has been impressive, with the latest leg from the May 31 low being almost exponential and the pattern of higher highs and higher lows remaining intact.
This situation is reflected in the stochastic oscillator as this indicator continues to trade at its overbought territory and it is actually currently trying to climb again above its moving average. However, the recent all-time high has not been met by a higher high in the stochastic and thus potentially hinting at the formation of a bearish divergence. In the meantime, the Average Directional Movement index (ADX) has been retreating from its multi-month high, reflecting the gradual loss of strength of the current bullish trend.
Should the bulls still feel hungry, they could try to push the stock towards the July 24 high at 404.51 and have the chance of recording a new all-time high.
On the other hand, the bears are anxiously trying to record some sort of a pullback. They would love for a drop below the April 28, 2021 high at 400.83 and a break of the long-term October 13, 2022 upward sloping trendline. If successful, the bears could then have the chance of testing the support set by the 382.61-382.80 area, which is defined by the January 26, 2023 high and the 50-day simple moving average (SMA).
To conclude, a correction in Mastercard stock is long overdue but the bears need the support of the momentum indicators, which at the moment are still favouring the bulls.
Related Posts: