Stock of the day: BASF
10 March 2023
In today's stock of the day, I will provide a brief update on BASF's situation, which has changed significantly since our last analysis in early February. At that time, the situation was bullish, with the price making new highs after a bullish breakout from a correction. Here is how I concluded that analysis:
“For the rest of the time, the price settled in a pennant formation, in reality moving only sideways. That ended yesterday with a very nice move to the upside and a bullish breakout from the pennant formation. With that, we received a fresh buy signal, which potentially can add a few more Euros to the price.”
However, BASF had a different idea of trading for the next few weeks, and instead of rising, the price dropped sharply. This is why we are re-analyzing BASF today, as we have reached a crucial long-term horizontal support level at 47.2, which has been with us since March 2022. As long as we remain above this support level, the sentiment is still positive. Any bullish price action can be considered a buy signal. On the other hand, if the price breaks below this support level, it would be a proper signal to go short.