Shares of Procter & Gamble Company have dropped to a level that has been support before. This means they may be about to rally.
There was support around $138.50 in early October. When shares fell to this level, they reversed course and moved higher.
Sometimes stocks will rebound or rally after they reach support. There’s support around $138.50 because it was previously a resistance level.
Many of the investors who sold Procter & Gamble came to regret their decision to do so after it traded higher. A number of these remorseful sellers decide to buy their shares back, but only if they can get them for the same price they sold at.
As a result, they place their buy orders at their selling price. If there are enough of these orders, it will create support. That’s what happened with the $138.50 level here. It could be the base for another uptrend to form.
By Mark Putrino
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