Technical Update - Pepsico likely to resume uptrend after weeks of selling pressure
Kim Cramer Larsson
Technical Analyst, Saxo Bank Group
Pepsico strong earnings yesterday gave a boost to the share price that jumped to approx. the 50% of the downtrend since August. Pepsico share price jumped bullish out of the falling wedge like pattern formed over the past couple of months.
If Pepsico can continue the bounce and close above $174.55 it has reversed the downtrend and confirmed new uptrend. An uptrend that can take Pepsico to August peak at around $181, potentially higher maintaining its uptrend (higher highs and higher lows) as can be seen on the wseekly chart.
RSI still showing negative sentiment but if the share price trades higher next few days RSI is likely to close above 60 threshold i.e., a change to positive sentiment.
If Pepsico lose momentum and closes below the upper trendline in the falling wedge it would be an indication of the potential uptrend is to be cancelled. If that plays out last week’s low at 160.98 and the medium-term rising trend line (see weekly chart) are likely to be tested. A close below both levels Pepsico is likely to drop to around 155.
Latest Market Insights
Q4 Outlook 2022: Winter is coming
- Winter is coming to the financial markets as central banks are tightening their grip. How spring will look is still a question.
European energy crisis: it will get worse before it gets betterThe winter in Europe will be tough, but whether the result is political chaos or sustainable, innovative solutions is still undecided.
A difficult and volatile quarter awaitsAs the year draws to an end, commodities continue to be at centre stage of the world with growth pockets political uncertainty.
The bright side: crises drive innovationThe positive spin on crises is that they come with solutions. It is worrisome that deglobalisation may be a response to this crisis.
Green transformation in China: renewable energy and beyondGoing green, China needs to span numerous energy sources to ensure stability, as every source comes with a challenge.
Asia: Intermittent solutions, but a faster renewable adoption curveAsian energy supply is being squeezed. This and the adoption of renewables may change the investment sentiment in the region.
FX: A Fed thaw needed to deliver a sustained USD turn lowerThe US Dollar can keep momentum when the Federal Reserve continues to tighten, leaving the rest to play to their drum.
Autumn can become ugly for equities and bond holders. Comfort for Dollar longsTechnical analysis suggests that equities could face a tough Q4 as could fixed income. US Dollar positions could provide some upside.
The next stock market sector to watch, with stocks going nuclearAs the world scrambles to find affordable, sustainable energy, nuclear is getting attention from politicians and investors alike.
The crypto space is getting cold when the hype disappearsCryptocurrencies face a winter of their own as retail investors and governments are asking tough questions.
Please read our disclaimers:
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
- Full disclaimer (https://www.home.saxo/en-gb/legal/disclaimer/saxo-disclaimer)