Stock of the day: Wells Fargo

Today, we are bringing you a short update on the Wells Fargo which we previously analyzed on 13. September. The price was finishing a very promising bullish reversal pattern – Inverse head and Shoulders. Back then, it was our base scenario for the following asset:

“A positive sentiment will be triggered only when the price breaks above the orange area. Once the price closes a day there, buyers will be able to claim full victory. As for now, we have to wait and see. A possible gamechanger could even come today!”

For this gamechanger, we had to wait a bit more. The price extended the right shoulder and broke the neckline more than one month later, at the end of October. This serves as an important reminder that in order to trade this kind of patterns, you need to wait for the breakout of the crucial support/resistances first.

Wells Fargo broke the 46 USD resistance (yellow) and then defended it as a support. This is a bullish price action and so is our current view on this instrument. Positive sentiment will be cancelled when the price closes a day below the 46 USD, but chances of that are now limited.