A Record-Breaking Ascend

American Express Company (AXP) catapulted to an unprecedented pinnacle on Wednesday, hitting an all-time high of $219 in the day’s trading session, riding on a robust bullish wave.

This surge marks a notable streak of six consecutive weeks in the green for the credit card giant, with an impressive 16 positive weeks out of the past 18.

The stock’s remarkable ascent, initiated in late October, has driven its value up by a remarkable 55%, showcasing the most substantial four-month growth since March 2021 and the second-strongest surge since November 2009.

Mixed Signals in the Midst of Growth

While recent news has failed to deliver significant new catalysts, American Express stock prices continue their upward trajectory, predominantly influenced by the positive outlook illustrated in the latest earnings reports.

• At the UBS Financial Services Forum, CFO Christophe Le Caillec highlighted that tenured small-business customers have curbed their spending, impacting the company’s growth rates.
• Raymond Joabar, American Express’ Group President of Global Merchant & Network Services, offloaded 8,625 shares, amounting to $1,837,470, following an SEC filing.
• Chief Legal Officer, Laureen Seeger, sold 84,420 shares valued at $17,979,772 on February 12, 2024.
• DBS Bank initiated American Express at a Hold rating earlier this month, with a $215 price target. Morgan Stanley, on the other hand, downgraded American Express from Overweight to Equalweight, raising the price target from $212 to $222.
• In late January, American Express slightly missed consensus estimates in its fourth-quarter 2023 results but delivered better-than-expected full-year guidance.
• American Express anticipates earnings of $12.65 to $13.15 per share for full-year 2024, with revenue growth projected at 9% to 11%.

The Balancing Act of Upside/Downside Potential

With Wall Street’s price target projections aligning closely with the company’s current price-to-earnings (P/E) ratios, valuations indicate limited room for significant upward or downward movements in the market.

Post the fourth-quarter earnings report and shifts in analyst recommendations, the median analyst price target for American Express stands at $218, mirroring the existing market prices with precision.

An Impending Test at the Resistance Line

Peering at the longer-term weekly chart, American Express shares are inching closer to a crucial dynamic resistance line that connects highs from October 2000 to February 2022.

This formidable resistance line lies approximately 4% away from current levels, at around $228 to $229 per share, setting the stage for a pivotal standoff for investors.

An anticipated breakthrough beyond this critical resistance level could propel American Express into unexplored territory, triggering profit-taking maneuvers among bullish investors amidst extreme overbought conditions.

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