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Financials are showing signs of life after the Fed's announcement in late June that several credit-card companies passed its "stress test" and were free to commence planned dividends and buybacks. One of them was Ally Financial Inc (NYSE: ALLY ), which got the greenlight to initiate its first dividend program since its IPO in 2014. The 8 cent quarterly payout implies a 1.9% forward yield.
ALLY shares are up about 7% since the news, including a cross above the 50-day moving average. And the Profit Scanner powered by Recognia sees 17%-21% further upside from here.
That outlook's based on ALLY's completion of a bullish Symmetrical Continuation Triangle on Tuesday. The pattern gets its name from its two converging trendlines as the stock makes lower highs and higher lows during a consolidation. Then, before the "triangle" fully completes, the stock confirms the pattern by breaking above the upper trendline. From here, we can expect ALLY to continue its prior uptrend.
Now that the bullish Symmetrical Continuation Triangle is confirmed, the Profit Scanner sets its price target for ALLY at $20-$20.80. This particular pattern is intermediate term, expected to resolve within 25 trading days.
Profit Scanner powered by Recognia can help traders of all levels uncover these signals to determine the best timing to buy. Or use Profit Scanner's technical insight to validate your own trading ideas. See how easy this powerful tool is to help you uncover hidden opportunities in the market.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.