In today’s Stock of the Day, let’s take a closer look at Booking Holdings, which currently shows a decisively negative technical setup on the chart. After a strong bullish trend, the stock seems to have reached its peak and is now undergoing a potential major reversal phase.
The structure visible on the chart is a Head and Shoulders pattern, one of the most reliable reversal formations in technical analysis. The blue neckline of this pattern has already been broken to the downside, confirming a sell signal. The price now trades below this crucial neckline, indicating that the previous bullish trend has been officially invalidated. The current move suggests that sellers are in full control, and the next target area lies around the red uptrend line, which has been guiding the market since early summer.
Interestingly, Booking Holdings has shown in the past that it respects classical chart formations very well. If we look back to the inverse Head and Shoulders pattern (marked in orange) that appeared earlier in the year, that setup successfully ended the previous bearish phase and initiated a strong bullish reversal. Now, the opposite situation may be unfolding — a Head and Shoulders at the top, signaling the end of the uptrend and a transition into a correction or even a broader downtrend.
The sentiment on Booking Holdings remains bearish as long as the price stays below the blue neckline. Only a daily close back above that level would invalidate the current negative outlook. For now, however, the path of least resistance points lower, and traders should prepare for further weakness in the sessions ahead.