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Goldman Sachs, a laggard is breaking out finally !

Medium-term technical outlook on Goldman Sachs (GS)

click to enlarge charts

Key Levels (1 to 3 weeks)

Intermediate support: 220.35

Pivot (key support): 207.80

Resistances: 238.20 & 245.00

Next supports: 179.90 & 160.05

Directional Bias (1 to 3 weeks)

Bullish bias above 207.80 key medium-term pivotal support for a further potential upleg to target the next resistances at 238.20 follow by 245.00 next.

However, a break with a daily close below 207.80 invalidates the bullish scenario for another round of corrective decline sequence within its long-term secular uptrend phase in place since Nov 2008 low for a drop towards the next support at 179.90 (the swing low area of 03 Jun 2019 & 61.8% Fibonacci retracement of the up move from 26 Dec 2018 low to 07 Nov 2019 high).

Key elements

  • GS has staged a bullish breakout yesterday, 08 Nov from a 3-month sideways range configuration in place since 24 Jul 2019 high with a relatively high-volume reading.
  • The weekly & daily RSI oscillators have continued to evolve in positive configurations which suggest medium-term upside medium remains intact.
  • The significant medium-term resistance zone of 238.20/245.00 is defined by a swing high area of 14 May/28 Aug 2018, a Fibonacci retracement/expansion cluster and the upper boundary of a major ascending channel from 26 Dec 2018 low).
  • Relative strength analysis from the ratio charts of GS against the market (S&P 500) and its sector (Financials) are showing “bottoming” formations. These observations suggest an impending potential outperformance of GS after underperforming both the S&P 500 and Financials sector for almost 10 months.

Charts are from eSignal 

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