Stock of the day: Procter & Gamble

The situation on the Procter & Gamble chart caught our eye today. Since the beginning of December, the price moves pretty much stopped and PG entered a sideways trend, which should end really soon and the end should come with a legitimate, long-term trading signal.

In reality, this sideways trend is a triple top formation, which in theory should bring us a bearish correction. Sellers actually tried to create a proper sell signal on Friday, when the price almost broke the neckline (red) of this formation. Almost is a keyword here as the price reversed and managed to close the day above the neckline – no sell signal here. On Monday, the market was closed but today, we should get some answers.

Price closing a day below the red neckline will be definitely an invitation for a bearish correction. On the other hand, price bouncing and advancing higher can potentially deny the triple top formation and totally cancel it bringing a proper buy signal. This will be created when PG will be able to close a day above the orange horizontal resistance around 154.5 USD. The second option seems currently slightly more probable.