The Goldman Sachs Group, Inc. (GS) reported a better-than-expected earnings per share on July 15, and the stock gapped higher at the open. Goldman shares jumped to $225.23 this day and then dropped to as low as $196.30 July 30.
Goldman Sachs stock has rebounded last week with a close above its 50-day and 200-day simple moving averages, which converge to $204.85 and $205.77. If the force being held this week, a gold cross will be confirmed. The stock closed last week at $208.27, down 9.4% year to date, and in the correction of a territory to 16.8% below its Jan. 17 high of $250.46. Goldman stock is also in the bull market territory 59.2% above its March 19 low of $130.85.
Basically, Goldman Sachs stock is at a reasonable price, with a P/E ratio of 10.84 and a dividend yield of 2.45%, according to the trends. The investment bank is a component of the Dow Jones Industrial average. The company has beaten earnings estimates the past two quarters after missing the expectations of the prior two quarters.
The daily chart for Goldman Sachs
Refinitiv XENITH
The daily chart for Goldman Sachs shows that the stock is in the consolidation of a market decline decline of 47.7% from its Jan. 17 high of $250.46 at its March 19 low of $130.85. The stock has been under a death cross since 26 March, when the 50-day simple moving average fell below the 200-day simple moving average. This has been confirmed after the stock made its low.
On the V at the bottom, the stock has returned to its 50-day simple moving average, the 20 April. After soaking for as little as $165.36 May 14, the stock has jumped to its 200-day simple moving average (205.98 May 27. The 200-day simple moving average has been a magnet, including the Friday, the rally.
Goldman’s stock is trading above its weekly, monthly, and quarterly value levels at $183.05, $177.87, and $173.85, respectively. Note how close the stock is to the confirmation of a golden cross, which will take place this week, if the shares stay above the 200-day simple moving average at $205.77.
The weekly chart for Goldman Sachs
Refinitiv XENITH
The weekly chart for Goldman Sachs is neutral, above its five-week modified moving average of $201.18. It is below its 200-week simple moving average, or the return to the average, to $218.94.
The 12 x 3 x 3 weekly slow stochastic reading fell to 63.89 last week, down from 65.70 31 July. In the month of January, this reading has been above 90.00, put the broth in a “swell parabolic bubble” of the training, and that has led to the 47.7% bear market of the accident.
Trading strategy: Buy Goldman Sachs stock on the weakness of the weekly, monthly, and quarterly value levels at $183.05, $177.87, and $173.85, respectively. Reduce the holdings on the strength of the 200-week simple moving average at $218.94.
How to use my value levels and risky levels: The share price closing price on Dec. 31, 2019, has been an entry to my proprietary analytics. Half-yearly and annual, the levels are still on the charts. Each level uses the past nine closes in these time horizons.
The third quarter of 2020 the level has been determined based on the 30 June close, and the level in the month of August has been established according to the July 31 close. New weekly levels are calculated following the end of each week, while new quarterly levels occur at the end of each quarter. Half-yearly levels are updated at mid-year, the levels are set throughout the year.
My theory is that nine years of volatility between the farm are to assume all possible bullish or bearish event for the stock are taken into account. To capture the volatility of stock prices, investors should purchase shares of the weakness of a plan, the value and reduce the holdings of the strength to a risky level. A pivot is a level value of the risk level that was violated in its time horizon. Hubs act as magnets that have a high likelihood to be re-tested prior to their time horizon expires.
How to use 12 x 3 x 3 weekly slow stochastic readings: My choice of using 12 x 3 x 3 weekly slow stochastic readings has been based on the backtesting of many methods of reading the stock prices of the momentum with the objective of finding the combination that resulted in the least number of false signals. I’ve been following the stock market crash of 1987, so I was happy with the results of more than 30 years.
The stochastic reading covers the duration of 12 weeks, high, low, and close for the stock. There is a row of calculation of the difference between the highest and the lowest compared to the farm. These levels are modified for a fast reading and slow reading, and I found that the slow playback will work best.
The stochastic reading scales between 00.00 and 100.00 with readings above 80.00 considered as overbought and readings below 20.00 regarded as oversold. A reading above 90.00 is considered to be a “swell parabolic bubble” of the training, which is usually followed by a decline of 10% to 20% over the next three to five months. A reading below 10.00 is considered to be “too cheap to ignore,” which is usually followed by a gain of 10% to 20% over the next three to five months.
Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
Source: investopedia.com
