Stock of the day: L’Oréal

January brings huge changes on many instruments but on the stock market, the one with a very promising shift in the sentiment is L’Oréal who started the new year with a very handsome, technical buy signal.

The whole of 2022 can be summarized in one formation: Inverse Head and Shoulders (yellow). January brought an upswing that broke the neckline (black) of this pattern, which, technically, triggered a buy signal. What are the next steps for L’Oréal? We have had three consecutive bullish weeks and some kind of a correction would be quite understandable. Should the traders decided to test the neckline as the closest support, it will be nothing out of ordinary.

As long as we stay above the neckline, the sentiment is positive. The target for the buyers is the high from the end of 2021 at 430 EUR (orange). The chances of getting there are quite high.