PURCHASE, NY – Mastercard Inc. (NYSE: MA) shares finished Thursday with a solid gain, but the full day’s chart tells a cautionary tale of fading momentum that could spell trouble for the stock at the start of next week’s trading.
The payments giant closed the session at
4.51 (0.83%). The day’s trading was a story of two distinct halves. The morning session saw a powerful surge of buying pressure, with the stock rallying strongly from its open of
556.70** shortly after midday. At its peak, the stock was up nearly $11 from its previous close, signaling robust bullish conviction.
However, the tide turned dramatically in the afternoon. Starting around 1:00 PM, sellers took firm control of the market. The stock entered a steady decline, giving back more than half of its intraday gains before the closing bell. The after-hours session showed little activity, with the stock inching up a mere 6 cents, suggesting a market pausing to digest the day’s reversal.
Outlook for Monday:
This type of price action, known as an intraday reversal or “fade,” is often interpreted as a bearish signal. While the stock closed in the green, the momentum heading into the weekend is clearly negative. Therefore, the market for Mastercard is likely to go down on Monday.
Here’s why:
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Failed Rally: The inability of the stock to hold its morning highs indicates that the buying pressure was exhausted. The peak at $556.70 now stands as a significant short-term resistance level.
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Negative Momentum: The most recent price action is a consistent sell-off. Markets often exhibit inertia, and this downward momentum from late Thursday is likely to carry over into Monday’s pre-market and opening session.
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Profit-Taking: The reversal suggests that investors who bought in earlier saw the rally as an opportunity to take profits rather than a signal to hold for further gains, a sign of weakening confidence at these levels.
Despite the positive closing number, the chart’s narrative is one of bearish dominance in the latter half of the day. Investors should be prepared for potential follow-through selling on Monday morning. A break below the day’s low of $545.55 could confirm the bearish reversal and lead to further downside.
