Technical Analysis – TD rally in danger as bears regain confidence
April 5, 2023 1:27 pm
TD has been recovering from the March lows, in line with other major banking institutions. This move has been rather aggressive with the stock dropping today, essentially undoing Tuesday’s move. TD has actually been on a downwards path since the February 11, 2022 high of 85.94, touching a 2.5-year low of 55.19 on March 24.
The bulls would love for the rally to continue, but they need support from the momentum indicators. The stochastic oscillator appears willing to answer the bulls’ call as it is currently moving almost vertically higher, increasing the gap from its moving indicator. However, this indicator is getting near to its overbought territory and hence the magnitude of possibly another upleg might be limited. In addition, the Average Directional Movement Index (ADX) has stabilized at elevated levels as the D+ has shot up to the highest level since January 2022.
Should the bulls manage to remain in control of the market, the busy 61.99-62.45 area defined by the 23.6% Fibonacci retracement of the February 11, 2022 – March 24, 2023 downtrend and September 21, 2018 high respectively, would be the initial target. The path then appears to be unhindered until the trifecta of simple moving averages (SMAs) at the 64.16-64.92 area and the 38.2% Fibonacci retracement at 66.94.
On the other side, the bears would love a retest of the July 5, 2019 high of 59.55, provided that they first successfully clear 61.06, the January 31, 2018 high. Even lower, the bears would mostly aim for the October 13, 2022 low of 57.27.
To conclude, the bulls are desperately trying to continue the recent upward move. They seem to have some support from momentum indicators, but the bears appear to be regaining part of their lost confidence.
TD has been recovering from the March lows, in line with other major banking institutions. This move has been rather aggressive with the stock dropping today, essentially undoing Tuesday’s move. TD has actually been on a downwards path since the February 11, 2022 high of 85.94, touching a 2.5-year low of 55.19 on March 24.
The bulls would love for the rally to continue, but they need support from the momentum indicators. The stochastic oscillator appears willing to answer the bulls’ call as it is currently moving almost vertically higher, increasing the gap from its moving indicator. However, this indicator is getting near to its overbought territory and hence the magnitude of possibly another upleg might be limited. In addition, the Average Directional Movement Index (ADX) has stabilized at elevated levels as the D+ has shot up to the highest level since January 2022.
Should the bulls manage to remain in control of the market, the busy 61.99-62.45 area defined by the 23.6% Fibonacci retracement of the February 11, 2022 – March 24, 2023 downtrend and September 21, 2018 high respectively, would be the initial target. The path then appears to be unhindered until the trifecta of simple moving averages (SMAs) at the 64.16-64.92 area and the 38.2% Fibonacci retracement at 66.94.
On the other side, the bears would love a retest of the July 5, 2019 high of 59.55, provided that they first successfully clear 61.06, the January 31, 2018 high. Even lower, the bears would mostly aim for the October 13, 2022 low of 57.27.
To conclude, the bulls are desperately trying to continue the recent upward move. They seem to have some support from momentum indicators, but the bears appear to be regaining part of their lost confidence.
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