April 7 Chart of the Day - SAP
Highly precise price action technical analysis offers the strongest trading edges and the most opportunities across the markets, making it the foundation of our reviews.
SAP (SAP) fell another 2.8% today, deepening a decline that now totals roughly 17% since early February. The sustained selloff comes as some analysts raise concerns over recent tariff announcements and potential reductions in government-related workforce spending - both of which could dampen the company’s future revenue growth. While SAP remains a key player in enterprise software, these macroeconomic headwinds are prompting a cautious reassessment from traders and investors.
Consistent profitable investing and/or trading requires a structured, rules-based approach to price action analysis. Proven processes, disciplined risk-reward management, and precise execution create the foundation for long-term success.
When combined with powerful mental performance strategies, this method becomes the ultimate blueprint for thriving in any market, on any time frame.
As requested, this analysis will take a price action technical analysis approach to assess key levels and potential next moves for the stock.
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Monthly Chart
On the monthly chart we can see that after reaching its all-time high of $293.70 in February price quickly faded back down.
With little to no prior price history at all-time highs, the price often enters what we call a "discovery phase" to establish new market structure.
In this scenario, price seemingly is speeding through the discovery phase and quickly fading back down towards previous and familiar price structure already bypassing previous support/resistant levels.
Volatility is a common price action behavior, though it tends to be unpopular among investors.
Weekly Chart
On the weekly chart we can see where price set its ATH before quickly dropping back down the past several weeks.
Price is quickly approaching a potential support area in the $215 to $230 area.
Why, then, does price sometimes pull back sharply after reaching all-time highs?
There are several possible reasons—one being that traders and investors may simply be locking in profits.
That said, the broader picture remains clear: for nearly a decade, the chart has shown a consistent pattern of higher highs and higher lows—classic signs of an ongoing uptrend.
It goes without saying though, the only guarantee in the markets is that price cycles. It cycles up and it cycles down across all time frames and all charts and rarely, if ever, moves in a straight line.
Only time will tell for sure what price will do next...
We've layered in traditional Fibonacci levels as well as support/resistance and trend to help identify potential price levels of interest and/or future price targets.
Armed with precision oriented charts like these both traders and investors can formulate their respective plans.
So what's next?
We don't make predictions...
Nobody knows for sure but using these 5 price action tools traders and investors can develop levels of interest in both directions.
- Support/Resistance
- Trend
- Fibonacci
- Supply/Demand Zones
- Change Control Zones
ChartPros provides the exact methodology in its price action technical analysis courses to create charts like this with the most precise and accurate levels from which investors and traders can formulate their respective trade plans.
Take a look at the charts and let us know what you think. We'd like to hear from you in the comments sections.
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