Chart of the Week: Goldman Sachs
We’re going to be profiling big investment bank, Goldman Sachs; GS is the symbol.
I can’t give any good positive scores on this chart right now. It’s ugly. We do know that they have earnings coming out in about a week or so. We think that the stock is probably bottomed out here for the time being. You can see the channel that I’ve drawn here that goes all the way back to June on the bottom portion of the channel. The top portion of the channels starts off in July. You can see a series of lower highs and lower lows, which is the definition of a downtrend.
We have bounced now off of the lower part of that support, and now what’s interesting is we see the stock has started to make a move on the low that was made in August. What’ll this do? If it gets above this level here and turns back down, it has the potential for making what’s called an inverse head and shoulders. We have the head already made down here in the early part of October, the left shoulder would be over in August, and if we could create a right shoulder …. I’m anticipating what a bullish pattern could like down the road. It’ll take some weeks to see this pattern develop.
We do have a bearish head and shoulders. We see the left shoulder here, the head there, and the right shoulder over here. But we haven’t broken down below the neckline yet.
This stock could turn higher
We’ll see if there’s some upside here. Certainly JP Morgan coming out with earnings on Friday morning is going to be a market mover, and is also going to move some of the banks, along with Bank of America.
Goldman Sachs and Morgan Stanley report next week. They came out with really decent earnings last time around. But of course the strong presence of sellers in bonds and the big push up in yield was a negative for some of these banks and financials.
Let’s take at the internals here and the indicators.
We can see that the money flow is rather flat here. The bottom indicator has my interest. This is the TDI, which is the Trader’s Dynamic Index. It’s crossed over here and if it could get another crossover above the middle line here, the darker line, it’ll be on a buy signal.
MACD is trying to turn up for a buy signal here as well. If it could get above there, we could probably get a move to about $325-330 on Goldman Sachs here in the next couple of sessions. We are $314 right now. And we are looking for about that $330-335 area before we could break free. Getting above that resistance line I’ve drawn in there since July would be a huge positive.
So that’s Goldman Sachs everyone!
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