Visa and Mastercard momentum structures vulnerable
Despite strong price charts, Visa and Mastercard are resting on critical, multi-year horizontal momentum floors that are at risk of breaking.
The argument
The guest argued that while ascending price lows suggest strength, quarterly momentum shows a flat floor that has been repeatedly tested. If these floors break, it will reflect the consumer credit distress seen in rising delinquency data.
The thesis, stress-tested
✓ What validates it
- ✓Visa and Mastercard closing a quarter below their respective three-quarter moving average momentum floors
▸ Risks discussed
- ▸Consumer spending resilience could keep momentum above the critical floor levels longer than expected
Hear it yourself
"In other words, you'll look at the momentum chart and it'll smack you in the face and say, I'm breaking out over a four point downtrend line or a three point uptrend line, or I'm breaking through a multiple horizontal floor that I've used for the last three years, same level I stop at every time, and then when you break it, you've broken…"
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