Stock of the day: Pfizer

We start this week with an update on Pfizer. The last time we analysed the situation on this instrument it was in the middle of June when the price was breaking a very important support. That support was the lower line of the triangle, and the signal from it was definitely negative:

“The breakout also gives us a proper, long-term, sell signal. This sell signal will be cancelled, should the price come back inside of the triangle, but chances for that are now limited.”

The update is that this signal didn’t last long and was actually a fake one. Instead of dropping lower, Pfizer created a false breakout pattern (green) and reversed back inside of the triangle. False breakouts are usually great signals to trade in the opposite direction and as you can see, that was also the case here.

Currently, the price is testing the upper line of the triangle and chances that we will get a bullish breakout here are quite significant. That breakout would bring us a proper, long-term buy signal.