Johnson & Johnson (NYSE:JNJ) stock is oversold and getting close to a level that has been support in the past.
Oversold refers to momentum. It means the stock has been aggressively sold so hard that it is below what would be its usual or typical trading range.
This is important because traders will be expecting a reversion to the mean, and this will draw them into the market as buyers. They could push the price higher.
Shares are also getting close to support around the important $158 level. Support is a large group of investors who are looking to pay close to the same price for new shares.
Stocks often rally off of support. This is especially the case when they are oversold. This is a fundamental principle of financial markets.
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