Stock of the day: Cisco

By Tomasz Wisniewski|

Published: May 15 2024, 03:52 GMT+0

Stock of the day: Cisco

Cisco’s stock has captured investor attention with its promising technical pattern displayed in recent trading sessions. Since the start of 2023, Cisco has been forming a symmetric triangle, indicating periods of uncertainty where the highs and lows converge toward a central point. This pattern was punctuated in May, particularly in Tuesday’s session, where the stock demonstrated a significant breakout from the upper line of the triangle. This movement suggests a shift from a period of consolidation to a potential uptrend.

The breakout was marked by a close above the upper boundary of the triangle, traditionally interpreted as a bullish signal. While the ideal scenario would have featured a more definitive bullish candle, such as a Marubozu, the existing candle still supports a strong buy signal. This indicates that despite some reservations about the candle’s decisiveness, the market sentiment is leaning positively, reflecting increased buying interest.

For investors and traders holding or considering Cisco, the current stance should be cautiously optimistic. As long as the price remains above the triangle’s upper line, the buy signal holds. However, a dip back into the triangle would suggest reevaluating positions, as it could herald a false breakout or a return to bearish sentiment. Given the current trajectory, the likelihood of re-entering the triangle appears limited, making this an opportune moment for bullish investors.