Stock of the day: Garmin
15 June 2023
The stock performance of Garmin presents an intriguing scenario, particularly after yesterday's volatility driven by the Federal Reserve's interest rate decision. The notable resistance level at $108.5, which served as a key resistance point in July 2022 and as vital support in February and April 2022, has been retested. The first contact with this resistance led to a bounce back, potentially signaling a forthcoming short-term correction.
In the broader perspective, Garmin continues to navigate a sustained downtrend that began in 2021. However, the most recent price increase appears as a bullish correction, resembling a flag pattern as marked by black lines on the chart. While we remain within this flag formation, the medium-term sentiment is positive, but a bounce from the current resistance could trigger a slight downward adjustment.
The activation of a substantial long-term sell signal on Garmin would require the price to breach the lower boundary of the flag formation. However, at present, this seems unlikely given our significant distance from this line. Should the price break through the orange resistance level, we would encounter a strong buy signal, potentially targeting the $38.2 Fibonacci level. Traders should carefully monitor this possibility.