January 10 Chart of the Day - Mercury Insurance Group
Precision oriented price action technical analysis by far provides the best edges and most setups for traders and investors across the markets so that's what we use for the basis of our reviews
Insurance and utility related stocks with California exposure significantly dropped Friday as Los Angeles firefighters continued to attempt to contain wildfires that have totally ruined thousands of homes and caused at least 10 deaths.
Shares of Allstate (ALL), the Travelers Companies (TRV), Chubb (CB), Mercury (MCY), and American International Group (AIG) — were all trading down on Friday with Mercury suffering the largest drop of roughly 20%.
Today, we take closer look at Mercury's chart from a price action technical analysis perspective.
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Monthly Chart
On the monthly chart we can see that after setting its $80.72 all time high (ATH) just a few short months ago price fell dramatically and for all intents and purposes is in search of a bottom.
Price potentially may want to visit a previous major support/resistance level in the $45 area.
This type of price action can be really tough on the buy and hold investors but at the same time can be a traders haven!
Weekly Chart
On the weekly chart we can see with much more clarity the fall from ATHs, and the relentless selling pressure given the current disaster.
Trading around $47 earlier today price may take a breather in this price area until further damage assessment is done.
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.
