The U.S. regional financial services holding company, headquartered in Lancaster, Pennsylvania, Fulton Financial Corp (NASDAQ: FULT) shows signs of an upcoming price surge according to its latest charts.
Bullish Indications
#1 IH&S Pattern: The daily chart of FULT shows that over the past several weeks, the stock has been forming an Inverted Head and Shoulders (IH&S) pattern, which is a strong bullish pattern. This is marked in orange color lines. After the completion of the IH&S pattern, the stock may move higher in the short term.
Daily Chart – FULT
#2 Above MA: The stock is currently trading above its 50-day SMA as well as 200-day SMA. The 20-day SMA has also crossed above 50-SMA. This indicates overall bullishness for the stock.
#3 MACD above Signal Line: The daily chart shows that the MACD (light blue color) is above the MACD signal line (orange color). This indicates a potentially bullish setup.
[hana-code-insert name=’adsense-article’ /]#4 Strong RSI: RSI is above 50 and moving up, indicating strength.
#5 %K above %D: The %K line of the stochastic is currently above the %D line, indicating bullishness.
#6 Channel Breakout: The stock has broken out of a downtrend channel, indicating bullishness. The channel is marked in purple color lines.
#7 Flag Pattern: As seen from the weekly chart of FULT, the stock was in a strong uptrend after which it started consolidating.
This is a classic flag pattern, which is a continuation pattern. The flag pattern is marked in purple color in the daily chart. Whenever a stock breaks out of the flag pattern, it typically continues its previous trend which is an uptrend in this case.
Weekly Chart – FULT
#8 Fibonacci Support: Usually, after an up-move, stocks retraces to any of the key Fibonacci levels before surging back again. FULT has taken support at the 61.8% Fibonacci support level of the upmove, as seen in the weekly chart. This seems like a good level for bounce-back.
#9 %K above %D: The stochastics show that the %K line is currently above the %D line in the weekly chart. This is a bullish sign.
#10 CCI moving up: The CCI moved up from below -100 and is currently above 100, indicating bullishness.
Recommended Trade (based on the charts)
Buy Price: If you want to get in on this trade, you can purchase shares of FULT at the current price of $18.
TP: Our target prices are is $20 and $25 in the next 3-6 months.
SL: To limit risk, place a stop loss at $16.80. Note that this stop loss is on a closing basis.
Our target potential upside is nearly 11%-28% in the next 3-6 months. For a risk of $1.20, our target rewards are $2 and $7. This is a 1:2 and 1:6 risk-reward trade.
In other words, this trade offers nearly 2X to 6X more potential upside than downside.
Risks to Consider
The stock may reverse its overall trend if it breaks down with high volume from the downtrend channel and IH&S breakout level. The sell-off of the stock could also be triggered in case of any negative news, overall weakness in the market, or any regulatory changes in the sector.
Happy Trading!
Tara
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