Yesterday, after delivering its earnings report, the Charles Schwab Corporation common stock (NYSE: SCHW) opened up with a large gap to the downside, also falling below the 200-day EMA. The share price also tested and broke below the lowest point of March, at 74.63, however it ended the trading session above that zone. At the same time, the stock is trading below a short-term tentative downside resistance line, drawn from the high of March 29th. Although we are leaning towards lower areas in the near term, we would prefer to see a push through that 74.63 hurdle first, in order to get comfortable with further declines.
Another drop below the 74.63 zone may spook more buyers from the arena and the stock could fall to the 72.08 hurdle, marked by the lowest point of October 2021. Initially, SCHW might stall there for a bit, but if there are no new buyers around that price, the slide may resume. That’s when we will aim for the 67.32 level, marked by the lowest point of September 2021.
The RSI and the MACD are both pointing lower. In addition to that, the RSI is below 50 and the MACD is below zero and the trigger line. The two indicators show negative price momentum, supporting the scenario mentioned above.
Alternatively, if the share price gets a boost and breaks above the aforementioned downside line, that may invite even more buyers into the field, especially if the stock travels above the 85.57 barrier, which is the current highest point of April. SCHW may then drift to the 89.28 obstacle, a break of which could set the stage for a move to the highest point of March, at 93.15.
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