NYSE:WFC may be ready to breakout.

A possible breakout setup was detected on WELLS FARGO & CO (NYSE:WFC) by our stockscreener. A breakout pattern is formed when a stock consolidates after a strong rise up. We note that this pattern is detected purely based on technical analysis and whether the breakout actually materializes remains to be seen. It could be interesting to keep an eye on NYSE:WFC.

What is the technical picture of NYSE:WFC telling us.

ChartMill employs a sophisticated system to assign a Technical Rating to every stock in its analysis. This rating, which ranges from 0 to 10, is determined by carefully assessing multiple technical indicators and properties.

We assign a technical rating of 7 out of 10 to WFC. Both in the recent history as in the last year, WFC has proven to be a steady performer, scoring decent points in every aspect analyzed.

• Both the short term and long term trends are positive. This is a very positive sign.
• When comparing the yearly performance of all stocks, we notice that WFC is one of the better performing stocks in the market, outperforming 79% of all stocks.
• WFC is currently trading in the upper part of its 52 week range. The S&P500 Index is also trading in the upper part of its 52 week range, so WFC is performing more or less in line with the market.
• In the last month WFC has a been trading in the 55.60 - 61.18 range, which is quite wide. It is currently trading near the high of this range.
• Prices have been consolidating recently, this may present a good entry opportunity.
• WFC is an average performer in the Banks industry, it outperforms 43% of 405 stocks in the same industry.

Check the latest full technical report of WFC for a complete technical analysis.

How do we evaluate the setup for NYSE:WFC?

Next to the Technical Rating, the Setup Rating of a stock determines to which extend the stock is consolidating. This score also ranges from 0 to 10 and is updated daily. The setup score evaluates various short term technical indicators. For NYSE:WFC this score is currently 8:

WFC has an excellent technical rating and also presents a decent setup pattern. Prices have been consolidating lately and the volatility has been reduced. There is a resistance zone just above the current price starting at 61.10. Right above this resistance zone may be a good entry point. There is a support zone below the current price at 59.61, a Stop Loss order could be placed below this zone.

How can NYSE:WFC be traded?

One strategy to consider is waiting for the actual breakout to occur, where the stock breaks out above the current consolidation zone. Traders can then enter a buy position, anticipating further upward momentum. As a risk management measure, it is advisable to set a stop loss order below the consolidation zone.

Of course, there are many ways to trade or not trade NYSE:WFC and this article should in no way be interpreted as trading advice. The article is purely based on an automated technical analysis and just points out the technical observations. Always make your own analysis and trade at your own responsibility.

More breakout setups can be found in our Breakout screener.

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.