Stock of the day: Heidelberg Cement

The American session ended yesterday in a bloodbath, which in theory should spill into European markets too on Friday. It’s a pity because we could see a few really promising bullish setups on some European companies. Forex example Heidelberg Cement from Germany. Again, maybe this company is not as famous as Apple or Tesla but it still follows the technical analysis, which totally makes it tradable.

What we can see on HEI is a big inverse head and shoulders pattern (yellow), which in theory is very often a great buy signal. The pattern is already up and running as on Tuesday buyers managed to break the neckline of this formation (red).

An Inverted Head and Shoulders is not the only thing we see here. Moreso, the price came back above the 38,2% Fibonacci, which should be considered as the end of bearish correction as well. Last but not least, we are currently inside a big wedge pattern (green) and after a bounce from its lower line, we’re on the way to test its upper resistance.

All that, would look great, if it wasn’t for what happened yesterday on the global stock market. Thanks to this or rather because of this, stocks can be under pressure today. Traders need to carefully watch the neckline. If the price stays above the red line, the buy signal will prevail. On the other hand, the price coming back below the neckline and later below the 38,2% will be a strong signal to sell. Despite global sentiment, this is currently less favorable option.