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Zimmer shares gain ground in line with expectations

Zareena Sayeedova, Leading Analyst, Global Markets (Finam)

In the past few weeks American producer of high-tech medical equipment Zimmer Holdings (ISIN: US98956P1021) has largely met our technical expectations and broke out of the flag that we highlighted, landing near the target price (the stock hit USD 64.81 on Wednesday).

However, the daily chart showed signs of a possible short-term correction, with an ascending wedge shaping up, and the price began to test the current trend line. The position of stochastic lines also points to a possible correction within the next few days, all the more since in recent sessions the volume has shown bearish sentiment gaining momentum.

Source: Reuters

In other words, if the stock easily breaks out of the wedge at USD 63.50, a further correction is likely, with the Ichimoku Cloud’s upper limit (USD 60.00) serving as the support level.