Visa Stock Slips 4.15% Amid DOJ Antitrust Suit Visa Inc. (NYSE: NYSE:V ), the world's largest payment processing company, has come under pressure as reports surface that the U.S. Department of Justice (DOJ) is preparing to file an antitrust lawsuit against the company. The allegations center around monopolistic practices in the U.S. debit card market, accusing Visa of using its dominant position to hinder competitors. In the wake of this news, Visa's shares fell 3.7% early Tuesday, marking a significant drop for the payment processor. Let’s dive into the key fundamental and technical aspects driving Visa's recent performance and future outlook.
Antitrust Concerns Cloud the Horizon
The DOJ's anticipated lawsuit is based on accusations that Visa (NYSE: NYSE:V ) has been using anti-competitive tactics such as exclusive agreements and penalties for customers using other payment processors. These tactics, according to the DOJ, have allowed Visa to maintain its dominant position in the U.S. debit card market, preventing competitors from gaining market share. This isn't the first time Visa has come under regulatory scrutiny; the DOJ previously blocked a $5.3 billion merger between Visa and fintech company Plaid in 2021, citing antitrust concerns.
Visa (NYSE: NYSE:V ) has also faced heightened scrutiny alongside its rival, Mastercard (MA), as both companies are often accused of operating as a duopoly in the payments industry. Recent reports suggest that Visa's volume-based discounts for merchants are a point of contention, with regulators arguing that these discounts create barriers for new entrants to compete effectively, keeping prices artificially high.
Despite these challenges, some analysts believe that the long-term financial impact on Visa's revenue may be limited. KBW brokerage estimates that Visa's U.S. debit business accounts for around 10% of the company’s total revenue. While the lawsuit could drag on for years, analysts are not expecting a significant blow to Visa’s earnings, although there may be volatility in the stock price during the legal proceedings.
Technical Analysis: A Slippery Slope for Visa's Stock
Visa's stock has been in a rising trend pattern for the better part of 2024, experiencing regular highs and lows as it steadily ascended. However, with the DOJ lawsuit looming, Visa’s stock experienced a sharp decline of over 4% during Tuesday’s trading, dipping to $278.04. This drop represents a crucial turning point as the stock nears a key support zone.
From a technical standpoint, Visa’s current price action shows the stock regressing towards the $255 pivot level, which previously acted as resistance in December 2023. This support level is critical, as breaking below it could lead to further declines. However, if the stock holds above this level, we could see a rebound in the coming weeks, especially if the market shifts focus away from the lawsuit and back to Visa's strong fundamentals.
The stock's Relative Strength Index (RSI) also provides insight into its near-term trajectory. Currently hovering at 46, the RSI suggests that Visa (NYSE: NYSE:V ) is approaching oversold territory. While not yet indicating a reversal, this level is crucial to watch, as a dip below 40 could signal further downside momentum. Conversely, an RSI rebound could spark a short-term rally, particularly if Visa’s fundamentals stabilize.
What Lies Ahead for Visa?
While Visa (NYSE: NYSE:V ) has encountered regulatory hurdles in the past, the payments giant continues to be a powerhouse in the global payments industry. Its ability to navigate legal challenges, coupled with its dominant market position, ensures that Visa (NYSE: NYSE:V ) remains a significant player in the long term. Additionally, Visa’s aggressive stock buyback program and global expansion into digital payments and fintech partnerships should cushion the blow from the ongoing antitrust investigation.
However, the uncertainty surrounding the DOJ lawsuit may weigh on the stock in the short to medium term, as investors brace for potential headlines and prolonged legal battles. Visa's earnings are not expected to take a substantial hit from its U.S. debit operations, but the negative sentiment from the lawsuit could cause the stock to fluctuate in the months ahead.
Conclusion
Visa’s stock is at a critical juncture, facing headwinds. The DOJ’s antitrust lawsuit has sparked concern among investors, but the long-term fundamentals of the company remain intact. From a technical perspective, all eyes will be on the $255 support zone, with the potential for a short-term rebound if Visa can hold above this level. Nonetheless, the legal proceedings are likely to introduce volatility, making Visa (NYSE: NYSE:V ) a stock to watch closely in the coming weeks.
Visashort
Visa ($V) Drives Dow Higher Amidst Trading Low by 1.45%Visa Inc. (NYSE: NYSE:V ) emerged as a beacon of strength in the stock market, propelling the Dow Jones Industrial Average alongside Boeing (NYSE: BA) following its robust quarterly results. Analysts responded with enthusiasm, hiking their price targets on Visa stock as they anticipate accelerated growth in the coming quarters.
Visa's stellar performance in its latest earnings report showcased a 20% surge in adjusted earnings to $2.51 per share, surpassing analyst expectations. Net revenue climbed 10% to $8.78 billion, driven by an 8% increase in payments volume, an 11% rise in processed transactions, and a remarkable 16% growth in cross-border payments volume.
CEO Ryan McInerney attributed Visa's success to "stable" consumer spending, underscoring the resilience of the company's business model amidst challenging market conditions.
For the third quarter, Visa ( NYSE:V ) provided bullish guidance, expecting low double-digit net revenue growth and operating expense growth in the low teens. Earnings per share growth is forecasted to be at the "high end" of a low double-digit gain, indicating strong momentum moving forward.
Maintaining its full-year outlook, Visa ( NYSE:V ) anticipates net revenue and operating expense growth in the low-double digits, with earnings per share growth in the low teens. Wall Street analysts are bullish on Visa's prospects, with forecasts predicting a 13% jump in adjusted earnings for 2024 and a 9.9% revenue growth.
In response to Visa's impressive performance and optimistic guidance, several research firms raised their price targets on Visa ( NYSE:V ) stock. RBC Capital highlighted the durability of Visa's business model and the potential for acceleration in the second half of the year, raising its price target to $315. UBS predicts strong organic net revenue growth and increased its price target to $325, while Wedbush raised its target to $300, maintaining an outperform rating on the stock.
Visa ( NYSE:V ) stock surged 2.5% in early Wednesday trading, signaling a potential move above its 21-day exponential moving average. With shares poised for a rebound above their 50-day line, investor confidence in Visa's growth trajectory remains strong.
As Visa ( NYSE:V ) continues to drive innovation and capture market opportunities, investors are optimistic about the company's ability to deliver sustained growth and value creation in the dynamic payments industry.
V Visa Options Ahead of EarningsIf you haven`t sold Visa on Ukraine's exposure:
or this Double Top:
Then analyzing the options chain and chart patterns of V Visa prior to the earnings report this week,
I would consider purchasing the 235usd strike price Puts with
an expiration date of 2023-8-18,
for a premium of approximately $3.60.
If these options prove to be profitable prior to the earnings release, I would sell at least half of them.
Looking forward to read your opinion about it.
V Visa Options Ahead of EarningsIf you haven`t sold V Visa here, for a better reentry:
Then analyzing the options chain of V Visa prior to the earnings report this week,
I would consider buying the 230usd strike price Puts with
an expiration date of 2023-6-16
for a premium of approximately $5.65.
If these options prove to be profitable prior to the earnings release, I would sell at least half of them.
I am interested to hear your thoughts on this strategy.
V Visa Options Ahead of EarningsIf you haven`t sold V Visa here, to reenter on the buy area:
Then you should know that looking at the V Visa options chain ahead of earnings , I would buy the $222.50 strike price Puts with
2023-1-27 expiration date for about
$3.64 premium.
If the options turn out to be profitable Before the earnings release, i would sell at least 50%.
Looking forward to read your opinion about it.
Selling Visa at swing highs.Visa - 30d expiry - We look to Sell at 216.49 (stop at 223.41)
We are trading at overbought extremes.
Bearish divergence can be seen on the daily chart (the chart makes a higher high while the oscillator makes a lower high), often a signal of exhausted bullish momentum, or at least a correction lower.
Bearish divergence is expected to cap gains.
We look for a temporary move higher.
The previous swing high is located at 217.61. 218.07 has been pivotal.
Preferred trade is to sell into rallies.
Our profit targets will be 199.22 and 195.22
Resistance: 215 / 218 / 225
Support: 206 / 200 / 195
Disclaimer – Saxo Bank Group.
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Visa $V Rejecting off top channel resistance -- BearishGiven FOMC is behind us now and the market is most likely following another leg down I'm expecting a top line rejection off of the large channel on the daily.
Rejected off the 200d MA of $218.11. Expect continuing rejection if we get a dead cat recovery at this point, but ultimately I see this impulse retracing back down. Notice the W pattern several bars before with a clear rejection off the top resistance with the large wick a few days prior.
MACD is making lower highs, RSI is coming back down and about to cross the signal to the bearish side. Stochastic is losing steam as well starting to fall from overbought territory. VI+ looks like its done making an engulfing void to the upside, which indicates that a reversal pattern with VI- is probably around the corner. TTM squeeze looks like its starting to apex as well.
Looking at the fib retrace from the previous low to high, and also following an extension downwards from previous high impulse to recent low and recent high we are looking at support levels of 0.236 at ~ $202.81 and 201.26 which is more or less where current price action is. Therefore expect the next couple of fib supports/resistances to be hit on both the retracement as well as the downward extension.
Retracement supports are as follow --
0.382 $194.42
0.5 $193.06
0.618 $188.70
Fib Extension resistances are as follow --
0.382 $194.91
0.5 $189.79
0.618 $184.66
Looking at the volume profile we see a good shelf of support up to the 0.5 fib extension.
Look for downward movement over the next 6 daily bars (10 days). Price action must clear the support shelf at $200 to continue downwards, otherwise expect sideways action between $200-203.
PT1: -6 pts -2.99% to the 0.382 extension ~ $194.91
PT2: -11.11 pts -5.33% to the 0.5 extension ~ $190 -- I think this is where $V will find support and probably start heading sideways.
Max PT: -16.11 pts -8.03% to the 0.618 fib extension ~ $185 -- Long shot, will have to continuously monitor to see how we move along with the macro and how the volume profile shapes up over the next few days.
Stop loss: ~$203.50 +1.53% from current action -- This would be the last stop on the volume profile upwards where the next would be a gap towards the upside.
Visa, Inc. (V)Founded in Foster City, California, by Dee Hock, this American multinational specialises in global payments technology. Its primary aim is to promote digital currencies among consumers, businesses, banks, and governments. Having built its network across 200 countries and territories worldwide, it is a global leader in digital payments. The company offers three different types of cards: Debit cards, Credit cards, and Prepaid cards. It also partnered with Apple in 2014 to introduce a wallet feature to iPhones. The company has various products, such as Visa Electron, Visa Cash, Visa Contactless, mVisa, and VisaCheckout.
V Visa exposure to Russia and UkraineVisa and Mastercard restricted transactions in Russia as aggressive penalties on the country over the invasion of Ukraine.
Around $1.2 billion of Visa Inc.’s annual net revenue comes from Russia and Ukraine.
4% of Visa’s total net revenue comes from Russia and about 1% from Ukraine.
In this case, my price target for the stock is the $187 resistance, while the sell-off area could touch $174 - $183.
Visa Looking to Loose More Ground. A nice looking zigzag appears to be forming on this one, with what I believe is a completed B Wave triangle. The picture is supported by momentum reversal as well.
We are not in the business of getting every prediction right, no one ever does and that is not the aim of the game. The Fibonacci targets are highlighted in purple with invalidation in red. Confirmation level, where relevant, is a pink dotted, finite line. Fibonacci goals, it is prudent to suggest, are nothing more than mere fractally evident and therefore statistically likely levels that the market will go to. Having said that, the market will always do what it wants and always has a mind of its own. Therefore, none of this is financial advice, so do your own research and rely only on your own analysis. Trading is a true one man sport. Good luck out there and stay safe.
VISA: Buy Zone is 206-211Visa just completed an impulsive 5-wave move off the low. It looks very clear that the bottom is in on Visa. Now the uptrend has become exhausted, and the stock need times to rest. The fibonacci extension targets have been reached, and you will also notice bearish divergences in MACD and RSI which also support this thesis. I will be targeting the .382 - .500 fibonacci retracement to buy.
Visa running out of credit. VDownard zigzag.
Immediate targets 214, 204, 197. Invalidation at 291.
We are not in the business of getting every prediction right, no one ever does and that is not the aim of the game. The Fibonacci targets are highlighted in purple with invalidation in red. Fibonacci goals, it is prudent to suggest, are nothing more than mere fractally evident and therefore statistically likely levels that the market will go to. Having said that, the market will always do what it wants and always has a mind of its own. Therefore, none of this is financial advice, so do your own research and rely only on your own analysis. Trading is a true one man sport. Good luck out there and stay safe
Short on open: 200.45
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Beautiful Range Setup On VisaEasy calls. You will want to play the breakouts either bottom or top range.
Key levels to watch 201 resistance and 187 support.
Breakout above you will look to hold till the highs of 214 for a nice take profit. Before taking profit at that level see how strong volume is and look for a breakout above. If breakout above hold it.
Break below support of 187 its probably going to be a lot of Distribution setup and dump.
VisaVery nice setup for Visa as it appears to be looking to break down out of a range for the past month and a half. Below the low of Friday around the $189.50 area looks like a very good opportunity to short down to a lower support for a $2 move. An overall market uptrend may try to stall this move, but it appears to be ready nonetheless.