Stock of the day: Autodesk

Hello traders, welcome to the stock of the day. Today, I would like to discuss Autodesk, a software company that has proven to be a key player in the design and engineering space. In the current climate, where we are witnessing a broad market correction, almost every instrument is trending lower, and fresh sell signals are emerging across the board. Amidst this backdrop, Autodesk stands at a critical juncture, as it finished Thursday perched precariously on a key support level.

For more than a year, Autodesk has been trading within the confines of a symmetric triangle pattern. This pattern, marked by black lines on the chart, indicates a period where the price has been oscillating, mostly around the $200 mark, in a consolidative manner, reflecting a balance between supply and demand. Most recently, in August, the stock’s price tested the lower boundary of this triangle not once, but twice, hinting at increasing bearish pressure.

Given the surrounding environment, which is increasingly bearish, the odds for a breakout to the downside are tilting notably higher. Should Autodesk close a trading day below the lower line of the symmetric triangle, it would trigger a proper long-term signal to sell. Under this scenario, a potential target for the bears could be around the $160 mark, aligning with the lows established in June 2022. Considering the broader market trends, the likelihood of this bearish outcome is becoming more and more significant.

On the flip side, if Autodesk were to decisively bounce off the lower line of the symmetric triangle, this could act as a bullish signal. In such a case, traders might consider a buying opportunity with a potential target around the $225 level. This target represents the upper boundary of the triangle, where previous attempts to break higher have been consistently rejected.

Source: https://www.axiory.com/analytics/stock-of-the-day/stock-of-the-day-autodesk-1