Investor Revolt Meets Rising Wedge for CRM
$Salesforce.com(CRM)$ has been a rollercoaster ride for investors in 2024. The stock price surged 67% last year, but year-to-date it's down 2.6%. This recent pullback coincides with an interesting development: shareholders rejecting the company's compensation plan for top executives, including CEO Marc Benioff. As a trader, this news creates an interesting backdrop for analyzing the technical chart.
Salesforce CEO Marc Benioff
Looking at the chart, a rising wedge pattern has formed. Rising wedges, often bearish in textbook, can be bullish or bearish, so it's important to identify potential entry and exit points. In this case, the price is nearer to the top of the wedge. If the price breaks down and falls back, I'll be closely watching the $245 level. This area has previously acted as support, and a bounce there could be a good opportunity to sell puts and collect premium on the expectation of a price rebound.
Rising Wedge Pattern
If the price slices through the wedge and continues falling, it would signal a bearish breakout. In that scenario, buying puts could be a profitable strategy. If the price keeps dropping, the value of the puts would increase, allowing me to profit.
CRM Daily Chart YTD
Zooming out to a longer-term view, I'd like to see Salesforce decisively break above the downtrend line that's been in place since April. Overcoming this resistance level at around $266 would be a bullish sign and could indicate a sustained price increase.
The recent shareholder revolt adds another layer of complexity to the Salesforce story. While it's difficult to predict how this will affect the stock price, it's a factor to consider.
From a trader's perspective, the rising wedge pattern and proximity to support levels present interesting opportunities for selling puts or buying calls depending on how the price action unfolds. For long-term investors, a breakout above the downtrend line would be a positive sign. However, the ongoing executive compensation issue adds a layer of uncertainty to the overall outlook. It will be important to monitor both the technical indicators and company news to make informed trading decisions.
Disclaimer: This is not financial advice. Do your own research before making any investment decisions.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
