Honeywell Share Price Analysis: Retracement, Support, and Potential Targets

Honeywell's share price has recently retraced approximately 8.6% since its breakout attempt in mid-November. This decline has caught the attention of investors, especially as the stock approaches key technical levels that could influence future price movements.

Technical Analysis: Key Levels in Focus

On the daily chart, the past two trading sessions have displayed hammer doji candlesticks, typically indicative of potential reversals. However, both doji candlesticks have closed lower than their opening prices, signalling continued weakness despite some buying interest.

Currently, Honeywell's share price is testing support at the 100-day moving average (100MA). This critical level appears to have encouraged buyers to step in, possibly due to two key technical indicators:

1. Stochastic Oscillator: Suggests oversold conditions.
2. Williams %R Indicator: Also points to a temporary oversold environment.

Short-Term Resistance and Potential Bounce

The combination of these factors may lead to a short-term rebound in Honeywell's share price. A potential target for such a recovery is $225 per share, where the 50-day moving average (50MA) is located. Historically, this level acted as a strong support zone in November and December, but it may now serve as resistance.

With the current price at $219.51 per share, a rise to $225 would represent a 2.5% gain. However, traders should be cautious of a potential breakdown below the 100MA, which could lead to further declines.

Downside Risks: Support at $210 per Share

If the 100MA fails to hold, Honeywell's share price may slide towards the supportive trendline (white), which aligns closely with the 200-day moving average (200MA) around $210 per share. This level is likely to attract significant buying interest, as it represents a critical long-term support zone.

A drop to $210 would equate to a 4% decline from the current price, offering a potential buying opportunity for investors targeting a medium- to long-term recovery.

Summary: Key Takeaways for Honeywell Investors

• Support Levels: Watch the 100MA and 200MA at $219.51 and $210, respectively.
• Resistance Levels: Monitor $225 as a short-term target and potential resistance.
• Indicators: Oversold signals from the Stochastic Oscillator and Williams %R may support a short-term price bounce.

Investors should keep an eye on these technical levels and indicators to gauge Honeywell’s next price movements.