Visa prediction as price slides to a 2-year low

on Sep 27, 2022
  • Visa trades at the lowest level in 2 years.
  • Deutsche Bank says the company’s business model remains resilient.
  • Visa lost a crucial $195 level and faces further downsides.

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Visa Inc. (NYSE:V) trades at $180 in the stock market. The price is the lowest since October 2020. The stock has now lost more than 6% in 5 days. The S&P 500 has shed at least 5% in the same period.

The fall in Visa stock coincides with growing recession risks globally. In Europe, analysts see more pain ahead with the impending recession and winter season. The potential downturn hurts stocks and indexes alike, and Visa is no exception. 

On a positive note, Visa has been labelled a resilient stock. Earlier this month, Deutsche Bank said that Visa’s business model will outwit “uncertain times.” Coupled with improving cross-border spending, the analysts point out that Visa will continue to enjoy its strengths.

Our article finds that Visa is a wide-moat company with a lot of competitive edge in the payments system. That has helped the stock retain its value during the market rout, at least up to the end of August. But as expected, investors’ fears will remain whenever there is turmoil. If investing in Visa due to its fundamentals makes sense, then the technical chart says otherwise.

Visa loses the $195 support

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Source – TradingView

Visa buyers defended the $195 support from June 2020. Price has always jumped after hitting the support. The decline below the level highlights that investors are wary of the mounting risks. The MACD indicator is deep in the bear zone and shows that momentum is weakening fast. The probable support zone lies at $162.

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Is Visa attractive

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If looking to invest in Visa, you must be aware that the market is still bearish. A potential bullish reversal could occur at lower levels of $160. Also, keep a tab on the macro developments.

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