ABB Ltd (ABB)

ABB stock forecast: buy or sell

ABB stock outlook

  • ABB stock skyrocketed 2.69% to close at $24.83 on the stock market today.
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Important:
The thoughts given in this post are personal and not recommendations for you to buy or sell shares. The author of this report does not have an understanding of the individual scenarios of the reader, his or her own financial statements or his or her own best interests at any given time. All users should speak with their financial advisor before buying or selling any securities Thoughts are expressed for informational purposes only

ABB stock chart overview

Should I buy ABB stock?

All successful traders recommend adhering to a trading strategy and not make decisions based on subjective opinions, rumors or feelings. Trading strategies are meant for helping you in the decision process of what stocks to pick and when is the best moment to buy them. At Stocks2.com, we like to use very simple but trusted and powerful trend following trading strategies. Simple things usually work the best

Is ABB stock a buy?

Currently, ABB stock matches one trading strategy:

ATH buy setup

One of the most recommended trading strategies is to buy on All-time Highs (ATH) breakouts. The good point of buying at all-time highs is that price doesn't have upper resistances, and usually it scales fast. However, there's the risk of a bulls trap that may trigger your buy order and then falls sharply. That's why a stop loss is so important. ABB can break to all-time highs any time soon, as it only needs to go up a 2.17%. Setup your buy order at $25.37 if you want to trade with this strategy. Set your stop-loss at $22.83

Buy setupBuy pointStop lossRisk
ATH buy setup$25.37$22.8310%
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Should I sell ABB stock?

When you own a stock with some profit, it's really difficult to decide the best moment to sell and get your benefits. Similarly to when we have to buy shares, deciding when is the best time to sell is not a haphazard decision, and we must use our own trading strategy. Our trading system selects very simple strategies to guide us on when is the best time to sell a stock. Be aware that these strategies are not intended for selling short ABB stock

As a rule of thumb, you must never mantain an open trade that leads to losses greater than those expected upon purchase. When to sell your stock should always be dictated by the stop-loss (automatic or manual)

Is it time to sell ABB stock?

Currently, ABB stock doesn't match any of our preferred sell setups, so if you own ABB shares and your operation is in profit probably is not time to sell now

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Analysts' recommendations to buy or sell ABB stock

Brokerage firms and financial institutions post stock ratings based on their views of the market and the fundamental and technical situation of the analyzed stock. Unfortunately, the accuracy of these predictions is not very high, and certainly not a direct buy or sell signal

In the last month, just one analyst rating was published for ABB

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ABB ratings

Brokerage firmRating
Jun 15th, 2020
JPMorgan Chase & Co. Strong sell

Technical analysis

SMAs overview

A favorite tool of many trading systems are the moving averages, that easily show market direction. A moving average is the average price of a stock over a set period of time. Moving averages are usually calculated on different periods depending on the trading timeframe 21, 50, 100 and 200 days are the most usual moving averages

Supports and resistances

Traders use supports and resistances to spot price points in the stock price action that may behave as barriers, preventing the price of an asset to move up or down. Supports are levels where the price may stop as it falls. Price is more likely to "bounce off" this level rather than break through it. Nevertheless, if the price breaks down the support, it will probably continue falling until approaching another support level. On the other hand, resistance levels are where the price may find a curb as it moves up. In the same manner, the price is more liable to "rebound" at this level, and if it finally breaches this level, the price will rise more easily until it finds the next resistance

The current resistances are:

  • R1: $25.37 (2.17% above)
  • The current supports are:

  • S1: $24.15 (-2.74% below)
  • S2: $23.43 (-5.64% below)
  • S3: $23.34 (-6% below)
  • Bollinger bands

    The so-called Bollinger bands are a well-established studio that was created by John Bollinger. It comprises 3 bands that are drawn superimposed on the price evolution chart:

    • The central band is a moving average, usually a simple moving average calculated with 20 periods
    • The upper band is calculated by adding to the value of the simple moving average 2 times the standard deviation of the moving average
    • The lower band is calculated by subtracting from the simple moving average 2 times the standard deviation of the moving average

    The price is moving near to the upper Bollinger band, poiting some level of overbought in recent sessions. This is not a bearish indicator, as price can trade in these levels for many days and weeks

    Relative strength index

    The relative strength index (RSI) is a technical indicator used in the analysis of financial markets. It is intended to plot the current and historical weakness or strength of a stock or market based on the closing prices of a recent trading period. Like other oscillation indicators, the RSI ranges between 0% and 100%. J. Welles Wilder introduced the relative strength indicator in the late 1970s and since then it has been widely used by traders

    Relative Strength Indicator (RSI) broke through the overbought line today, marking a reading of 72.81. Crossing up above the overbought zone is not a bearish signal, as stocks can be in the overbought zone for many weeks and may continue to rise

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    Earnings and financials

    ABB Ltd (ABB) reported EPS for the fiscal Q1 that highly beat Wall St. expectations. Quarterly EPS was $0.30 per share from an estimated $0.16. This Q1 report represents an earnings surprise of 87.5%. On the contrary, the company reported revenue was $6.2 billion in line with the market forecasts.

    Same quarter last year, reported EPS was $0.31, so recently reported EPS means a loss of -3.23%. Looking at sales, figures went down a -9.26% compared to $6.9B same quarter 12 months ago.

    ABB is hosting the Q2 earnings call on Wednesday next week. Estimated per-share earnings of %s for this quarter is $0.09. Earnings reporting day has a more than usual risk for traders as the data disclosed can jump up or down the shares price with very low liquidity and not respecting your buy/stop-loss orders. You can probably obtain more details about the earnings conference call and the financial reports on the Investor Relations section of its website: http://www.new.abb.com.

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