Looking at the technical picture of The Western Union Company stock (NYSE: WU) on our 4-hour chart, we can see that the price has been sliding since January 8th, while trading below a short-term tentative downside resistance line drawn from the high of the same day. The stock is now approaching one of its key support areas, at 21.50. Although the current short-term trend is to the downside, we would prefer to wait for a drop below that support area, before aiming for lower areas.
If, eventually, WU falls and closes a trading day below that support hurdle, at 21.50, this may increase the stock’s chances of pushing further south. The price might end up sliding to it next support area between the 20.64 and 20.79 levels, marked by the lows of November 12th and 20th. Initially, WU could stall there for a bit, however, if there are still no new buyers in sight, this may result in another drop, possibly bringing the price to the 20.13 level, marked by the low of November 4th.
Both, the RSI and the MACD, are pointing lower. In addition to that, the RSI is below 50 and the MACD is below zero and its trigger line. The two indicators seem to be in support of the above-discussed scenario, as both are showing increasing downside price momentum.
Alternatively, if the stock is able to reverse up, break the aforementioned downside line and climb above the 22.28 barrier, marked by the low of January 13th, that might attract more new buyers into the game. Such a move may signal a change of the short-term downtrend, potentially opening the door to some higher areas. That’s when we will aim for the 22.58 obstacle, or even the 23.04 zone, which is the low of January 8th. If the buying doesn’t end there, the next possible resistance level could be at 23.70, marked by the current highest point of January.
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