Stock of the day: Mastercard

In today’s stock of the day, let’s take a closer look at Mastercard, which delivered a proper long-term buy signal at the end of the previous week. This signal is technically well-grounded and comes from a combination of two reliable bullish formations aligning at the same time, which significantly increases its credibility.

First of all, the broader structure shows that Mastercard has been in a long-term uptrend, and the recent weakness was only a bearish correction, not a trend reversal. That correction was shaped like a flag formation, marked with black lines. Flags are classic continuation patterns, and in this case, the price escaped from the flag to the upside, signaling that the correction is over and that buyers are regaining control. A breakout from a flag in the direction of the prior trend is a textbook buy signal.

Adding to this bullish case, the flag itself finished with an inverse head and shoulders pattern, marked with an orange rectangle. This is a powerful reversal formation, especially when it appears at the end of a corrective move. The price has now broken the red neckline of this inverse head and shoulders, activating another independent buy signal. The combination of a bullish flag breakout and an inverse head and shoulders breakout creates a strong confluence, reinforcing the positive outlook.

From here, sentiment on Mastercard remains clearly positive as long as the price stays above the red neckline and above the upper black line of the former flag. These levels should now act as support. A drop back below them would invalidate the bullish setup and cancel the buy signal. As long as that does not happen, the technical picture favors further upside and continuation of the long-term uptrend.

Source: https://www.axiory.com/analytics/stock-of-the-day/stock-of-the-day-mastercard-5