Stock of the day: Merck
22 May 2024
On the chart of Merck, a clean and bullish ascending triangle pattern is forming. This pattern features a resistance level at $132, marked in yellow, and a green dynamic support line. The ascending triangle, which typically forms after an upswing, suggests further bullish momentum. However, for a buy signal to be confirmed, the price needs to close above the yellow horizontal resistance. This would indicate a breakout and potential continuation of the uptrend.
Conversely, the pattern will be invalidated if the price closes below the green dynamic support. In this scenario, the bullish outlook would be negated, and a bearish move could follow. Currently, the chances of an upward breakout appear more probable, given the existing market conditions and the structure of the ascending triangle.
Traders should monitor Merck closely for a daily close above $132 to confirm the buy signal. If this breakout occurs, it would likely attract more buying interest and push the stock higher. Until then, caution is advised, but the technical setup suggests that the bullish scenario has a higher likelihood of playing out