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Finance

Goldman Sachs Group (GS) Ready to Breakout?

Shares of Goldman Sachs Group (GS), may be setting up for a breakout, as it nears a key level of resistance this morning.

GS is a leading global investment banking firm whose activities are organized into investment banking, global markets, asset management, and consumer and wealth management segments.

The company saw increased earnings and revenue backed by its underwriting business, lower provisions, and escalated costs. It should see further gains as M&A activity picks up. Goldman’s business diversification, cost management initiatives, and strong liquidity should keep the company going during the current economic downturn.

Sales are expected to be up 14.78% for the year, while earnings are expected to soar 27.83% next year. GS had $153 billion in cash at the end of the last quarter and a current ratio of 1.81. The stock is undervalued with a trailing P/E of 11.59.

GS has shown recent bullish momentum, but is down 10.8% year to date. This has led a “Neutral” rating in our POWR Ratings system.

Take a look at the 1-year chart of GS below with added notations:

 Chart of GS provided by TradingView

GS was rallying nicely into the summer but has recently settled into a sideways trading range. While in the range, the stock has formed a resistance level at $215 (red), and a level of support at around $185 (green).

With the strong market in the rally today, the possible long position on a breakout above $215.

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Christian Tharpe, CMT

@cmtstockcoach


GS shares rose $12.66 (+6.29%) in premarket trading Monday. Year-to-date, GS has declined -5.24%, versus a 15.22% rise in the benchmark S&P 500 index during the same period.

About the Author: christian

Christian is an expert stock market coach at the Adam Mesh Trading Group who has mentored more than 4,000 traders and investors. He is a professional technical analyst that is a certified Chartered Market Technician (CMT), which is a designation awarded by the CMT Association. Christian is also the author of the daily online newsletter Todays Big Stock. More…

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