Stock of the day: Johnson & Johnson

Johnson & Johnson has had a volatile year, with its price swinging from local lows in the middle of the year to yearly highs in September, and now retracing towards those earlier lows. On the weekly chart, two critical levels are dominating the technical outlook.

The first key level is a horizontal support zone around $144, marked in yellow. This area has served as a strong base previously and is likely to be tested as the year winds down. The second important level is the black downtrend line, representing long-term resistance. For now, the focus remains on the support level, as the approach towards $144 looks more probable in the short term.

Trading Implications

1. Bullish Scenario: If the price respects the $144 support level and forms a bullish candlestick pattern, such as a hammer or a bullish engulfing, it could present a compelling buying opportunity. This would suggest renewed buyer strength and the possibility of a recovery heading into 2024.
2. Bearish Scenario: Conversely, a decisive weekly close below $144 would signal a breakdown of the support zone, opening the door for a deeper correction. This would turn the sentiment decidedly bearish for Johnson & Johnson.

The coming weeks will be crucial in determining the stock’s trajectory as it approaches this critical support area.

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