Wells Fargo & Company (NYSE: WFC) Potential breakdown of a bearish rising wedge should price fail to hold at the wedge support level.
1. The price has retested the current wedge support level, a breakdown of which will provide a bearish signal for further downside.
2. The price could continue to trade lower if a breakdown occurs to retest the support zone at US$30.90-36.40, when calculating the target area for the rising wedge breakdown by taking the height (US$9.54) and projecting onto the breakdown point at US$41.70.
3. The support zone is also confluent with a previous strong horizontal resistance level at US$31 from March to June 2020 and a 61.8% Fibonacci retracement level at US$34.70, calculated using a swing high of US$58.81 and swing low of US$19.79.
Red box = Resistance zone
Green box = Support zone
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