Stock of the day: PayPal

By Tomasz Wisniewski|

Published: May 23 2024, 07:51 GMT+0

Stock of the day: PayPal

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In today’s analysis, we focus on PayPal, which is currently showing a strong sell signal. The end of April saw the stock reaching local highs, but this was a false dawn. PayPal’s long-term price movement has been confined within a wedge pattern marked by black lines. The price rebounded off the upper line of this wedge, leading to a false breakout above the key resistance level at $68, marked in green. This false breakout, highlighted in yellow, is a classic sell signal, and indeed, the price has been declining steadily throughout May.

Yesterday, PayPal reached a new monthly low, which was significant for two reasons. Firstly, it confirmed the persistent downward trend. Secondly, it marked a breakout below the lower line of the wedge. This breakout is a strong sell signal, suggesting that the price could continue to fall towards new long-term lows. The target for this bearish move is the low from October 2023, and the chances of reaching this target are quite high given the current momentum.

Traders should take note of this bearish setup on PayPal and consider the implications of the recent breakout below the wedge. The technical indicators suggest further downside potential, making this an opportune moment to consider selling or shorting the stock.

Source: https://www.axiory.com/analytics/stock-of-the-day/stock-of-the-day-paypal-1

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