Swing Trade Idea (WFC) – February 16, 2023
Our bearish trade for Thursday, February 16th, is Wells Fargo & Company (WFC). WFC is part of the Financials Sector, which has performed at 2.42% over the last month, with WFC overperforming relative to its sector at 8.73% over the same period.
WFC formed a double top at a key area of $48 and shows signs of exhaustion. As this is a counter-trend trade, we believe that WFC will retrace lower from this level with the next support at around $44.
As a stop loss, if WFC were to trade above $24.50 for multiple days, this would invalidate our analysis and will consider cutting losses on the trade. We also will consider cutting losses on this options trade if the value of the vertical spread moves above $2.38.