ADP Could Be Fighting Higher
One of the remarkable things about the current economy is the resilience of the labor market. Today’s chart focuses on a key name in that field: payroll giant Automatic Data Processing.
Consider how ADP troughed below $195 in January and February. Its next low in June was slightly above that level. Then on October 13 as the broader market tanked, this stock bounced above $215. Those higher lows could reveal the presence of an uptrend.
Next is the surge to new all-time highs in August following a strong quarterly report. That rally broke a trendline running along the highs of January of April. ADP pulled to back to hold the same line this month. Old resistance becomes new support.
Third, ADP has touched its 50-, 100- and 200-day simple moving averages (SMAs) in the last three weeks. The proximity of those lines to each other demonstrates how much the stock has consolidated in the last year. Interestingly, the three returned to a bullish sequence (with the fastest on top) in mid-August.
If that suggests the longer-term trend remains positive, the last pattern could show the shorter-term trend moving similarly. Our 2 MA Ratio custom script at the bottom shows the 8-day exponential moving average (EMA) as a ratio versus the 21-day EMA. Notice how the most recent jump pushed the faster EMA above the slower EMA.
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This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
Consider how ADP troughed below $195 in January and February. Its next low in June was slightly above that level. Then on October 13 as the broader market tanked, this stock bounced above $215. Those higher lows could reveal the presence of an uptrend.
Next is the surge to new all-time highs in August following a strong quarterly report. That rally broke a trendline running along the highs of January of April. ADP pulled to back to hold the same line this month. Old resistance becomes new support.
Third, ADP has touched its 50-, 100- and 200-day simple moving averages (SMAs) in the last three weeks. The proximity of those lines to each other demonstrates how much the stock has consolidated in the last year. Interestingly, the three returned to a bullish sequence (with the fastest on top) in mid-August.
If that suggests the longer-term trend remains positive, the last pattern could show the shorter-term trend moving similarly. Our 2 MA Ratio custom script at the bottom shows the 8-day exponential moving average (EMA) as a ratio versus the 21-day EMA. Notice how the most recent jump pushed the faster EMA above the slower EMA.
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Important Information
TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. You Can Trade, Inc. is also a wholly owned subsidiary of TradeStation Group, Inc., operating under its own brand and trademarks. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.
This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
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