Stock of the day: Banco Santander
20 November 2023
In today's spotlight, we turn our attention to Banco Santander, a stock not typically known for its high volatility but currently exhibiting an intriguing technical pattern on the charts. After an extended period of over a year, the stock has finally achieved a noteworthy milestone. It has successfully broken out of a long-standing symmetric triangle pattern, delineated by black lines, signaling a shift in market sentiment.
This breakout to the upside is a noteworthy event, effectively activating a buy signal for the stock. It's important to note, however, that Banco Santander is typically characterized by gradual movements, suggesting that while the bullish trend is apparent, it may not lead to rapid or dramatic price changes in the immediate future.
The primary bullish scenario envisages the stock price progressing towards a significant horizontal resistance level. This resistance, highlighted in yellow on the chart, is situated at 3.85, mirroring the peak achieved in March 2023. Reaching this level would solidify the current positive momentum and could potentially set the stage for further upward movement.
Conversely, should the stock price retract back below the upper boundary of the triangle, it would indicate a false breakout. Such a development would transform the current optimistic outlook into a compelling sell signal, urging caution among investors. Nonetheless, the likelihood of the bullish scenario unfolding remains higher, given the recent breakout and the prevailing market dynamics surrounding Banco Santander.