Stock price has now fallen and closed below key support. with the RSI indicating oversold conditions

Morgan Stanley’s share price currently trading at around $70.81. We can see that after its earnings a fortnight ago the price has taken a plunge, with its share price now falling and closing below the key support of $72.23 (red oval). The next important level of support now sits at $66.85, a price level last seen in January of 2021. The bias has now shifted towards the negative side of the spectrum, but short-term rises cannot be officially ruled out. If we look over to the technical indicators, we can see the RSI is oversold, reading 27. On the previous two occasions when the RSI found itself in a similar position, a short-term price bounce occurred. However, this is not guaranteed to happen again as the RSI is a lagging indicator and sometimes the general market sentiment can have more of an influence on price movements than speculation. The MACD is negative but volume has lowered slightly. If any short-term rises were to occur, resistance can be seen at the $72.23 which was the previous support level. A move back up above the trendline would then require the stock to overcome $72.68 before any further resistance levels are outlined.