Earnings play: Paychex

Look for support around 95.00.

Uptrend 4

On Wednesday, before market, Paychex (PAYX), a payroll services company, announced second quarter adjusted EPS of $0.73, exceeding the estimate, up from $0.70 a year ago on revenue of $983.7 million, also above the forecast, down from $990.7 million last year.

From a chartist's point of view, Paychex's stock price gapped up to an all-time high after the company reported earnings before the bell. On December 17th, Paychex's stock price broke out to the upside of a bull flag pattern that began to form in late-October. The simple moving averages (SMAs) are arranged in a bullish manner, as the 20-day SMA is above the 50-day SMA and the 50-day SMA is above the 200-day SMA. As long as price can hold above its breakout level around 95.00 it will likely grind towards its first Fibonacci target of 107.75. If price can get above 107.75 then it could rally to its second Fibonacci target of 114.50. On the other hand, if price slips below 95.00 traders should look for support at 89.25. If 89.25 fails to support price, it would be a bearish signal that could send prices lower.    

Source: GAIN Capital, TradingView

More from Earnings

Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.

Open an Account