VISA Breaks the Downside Line

by Darius Anucauskas
13:25, 2019/02/05

Even though Visa Inc. (NYSE: V) stock was also affected by the turmoil in the equity markets during the second half of 2018, the share price has managed to climb back and recover more than half of its losses made in that period. From the technical side, as of yesterday, V is trading above its medium-term downside resistance line, taken from the high of October 1^st. At the same time the stock remains above its short-term upside support line drawn from the low of December 24^th. For now, we will aim a bit higher, but with a possibility of seeing a small retracement back down before another potential leg of buying.

Visa Inc stock is now getting closer to its key resistance area at 142.10, marked by the highs of December 7^th and November 30^th. Because, historically, the level managed to hold the price down for some time, there is a possibility of seeing the share price getting held there for a bit, or even sliding slightly back down. But as long as the price remains above the two lines (the downside and the upside ones), we will continue looking north in the near term. The next potential area of resistance to watch out for could be at 145.70, which is the high of December 3^rd.

Taking a quick glance at our oscillators, the RSI is above 50 and keeps pointing higher. The MACD continues to run above zero and from yesterday, it shifted above its trigger line and started pointing higher. Both indicators suggest that the momentum is picking up again and we may see some more upside in the stock’s trading.

Alternatively, in order to start considering much lower levels, we would like to see a drop below both the downside and the upside lines, in order to consider a further slide. This is when we may target the 135.71 hurdle, which is the low of February 1^st. If, eventually, that hurdle fails to withhold the downwards-pressure, a break of it could set the stage for a re-test of the 133.23 support zone, marked by the low of January 31^st.

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