Current trend

Shares of Wells Fargo & Co., one of the leading banking and insurance companies in the United States, are correcting at 54.00.

The corporation is under pressure after proven allegations of misleading customers in the provision of financial services. To prevent the settlement from leading to an increase in losses, management decided to sell the local business for servicing commercial mortgages to Trimont LLC. The transaction may be completed in the first half of 2025. If the business is spun off, Trimont LLC will become the largest commercial mortgage operator in the United States with a market share exceeding 11.0%.

Evercore Inc. analysts expect at least three interest rate adjustments this year from the US Fed, due to which the net interest income of financial institutions will be significantly lower than the current one, and the target price for the issuer’s securities will fall from 67.0 dollars to 65.0 dollars but the rating remains as Outperform.

The company’s financial report for the third quarter is due in early October: revenue may amount to 20.38B dollars, below 20.69B dollars in the previous period and 20.86B dollars a year earlier, and earnings per share – 1.27 dollars, behind 1.33 dollars and 1.48 dollars, respectively.

Support and resistance

On the daily chart, the trading instrument is moving in a corrective trend, retreating from the resistance line of the downward channel 58.00–48.00. Technical indicators issued a new sell signal: the EMA oscillation range of the Alligator indicator is expanding downwards, and the AO histogram is forming downward bars below the transition level.

Resistance levels: 55.30, 59.00.

Support levels: 52.50, 48.00.

Trading tips

Short positions may be opened after the price declines and consolidates below 52.50, with the target at 48.00. Stop loss is 54.00. Implementation period: 7 days or more.

Long positions may be opened after the price grows and consolidates above 55.30, with the target at 59.00. Stop loss is 53.00.