Stock of the Day: PayPal

In today’s stock of the day, let’s turn to PayPal, where the chart paints a grim picture for buyers. The dominant formation is a wedge pattern, marked with red lines, which dictated price action through recent months. At the end of July, we even saw a false breakout to the upside, highlighted in orange, but instead of fueling optimism, that move sparked an aggressive sell-off. The false breakout was followed immediately by a bearish gap and a deep slide to the downside, erasing hopes for a bullish reversal.

Following that breakdown, PayPal entered a period of consolidation, carving out a sideways range marked with a yellow rectangle. This pause reflects a market waiting for direction. While the price is currently testing the upper boundary of this rectangle, the broader sentiment remains bearish. The earlier wedge breakdown and the false breakout strongly weigh on the outlook, making it more probable that sellers will continue to push the stock into lower lows and lower highs.

The key lies in the breakout from the yellow rectangle. A move to the downside would confirm the continuation of the bearish trend and further extend the sell signal. Conversely, a surprising close above the upper boundary of the rectangle would challenge this narrative, but given the prevailing momentum, downside risk appears far more dominant at this stage.

Source: https://www.axiory.com/analytics/stock-of-the-day/stock-of-the-day-paypal-8