Vantiv Stock Breaks Out, Implying Higher Stock Prices

Vantiv Stock
Credit:iStock.com/utah778

VNTV Stock: Bullish on Multiple Time Frames

It brings me great pleasure to express my opinion on Vantiv Inc (NYSE:VNTV) stock. This holding company operates as a payment processor, which may not seem so compelling on the surface, but I surely believe that it is. We are transitioning into a digital world where commerce transactions are becoming as easy as swiping a plastic card over a reader. Eventually I could envision a digital world where cash has become an obsolete, archaic relic. The growth prospects for this sector are apparent, and it is arguably the reason why VNTV stock has been putting up such great performance numbers.

Anyone who has followed my work knows that the backstory on a company is secondary to what I really look for in an investment. That being said, the reason I am enamored with Vantiv stock is because it has the utmost intriguing and compelling stock chart.  The stock is producing bullish indications on multiple time frames, which reinforces and reaffirms holding a bullish view on this investment.

The following VNTV stock chart illustrates a technical price pattern that is now suggesting that higher stock prices are on the horizon.

Vantiv Stock chart

Chart courtesy of StockCharts.com

The technical price pattern that is highlighted on the VNTV stock chart is an “inverse head-and-shoulders” pattern.

This technical price pattern consists of three troughs and a neckline. The first and third troughs, which create the shoulders, are usually of equal size, and the middle trough, which is the largest, creates the head. The neckline is defined by a significant level of price resistance, which is created by connecting the peaks that separate the troughs.

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An inverse head-and-shoulders price pattern is completed when the stock price breaks above the neckline, which serves to indicate that higher stock prices are likely to follow. This is exactly what happened on August 9, and this feat is highlighted as a breakout on the VNTV stock chart. The stock has accelerated to the upside, just like pattern suggested.

As a standalone indicator, the head-and-shoulders price pattern is compelling, but as is always the case, I require reinforcing indications to reaffirm the bullish implications suggested by the technical price pattern. This is why I have included the following Vantiv stock chart that illustrates an indicator that supports the notion of higher stock prices.

Vantiv price chart

Chart courtesy of StockCharts.com

All the focus on this chart is contained in the the lower panel labeled “MACD.” MACD stands for “moving average convergence/divergence,” and this indicator is used to distinguish between bullish and bearish momentum. A bullish cross suggests that bullish momentum is influencing the stock price, while a bearish cross suggests that bearish momentum is influencing the stock price.

Momentum creates the path of least resistance, and therefore it is required to stage a price advance or decline. It is always wise to see which way this indicator is aligned because it has an uncanny ability to suggest which direction the stock price is heading in.

In March of this year, a MACD bearish cross was generated, indicating that lower stock prices were set to prevail. while this indicator was engaged, the inverse head-and-shoulders price pattern was in development.

In July of this year, a bullish MACD cross was generated, indicating the higher prices were set to prevail, This coincided with the completion of the head-and-shoulders price pattern, reaffirming the bullish implication suggested by it.

This bullish move to the upside has been within the context of a much larger bullish trend, which is highlighted on the following chart.

vntv stock chart

Chart courtesy of StockCharts.com

If the bullish indications I have highlighted were not intriguing enough, the long-term trend clearly shows another that began its inception in 2012. This bullish trend contains the quintessential characteristic that defines all bullish trends: a series of higher highs and higher lows.

This characteristic is easily captured using two upward-sloping trend lines that serve to define levels of price support and resistance.  These trend lines create an ascending channel which has clearly defined this bullish trend. The theory behind an ascending channel clearly states that as long as the stock price continues to oscillate within it, then higher stock prices are likely to prevail.

Bottom Line on Vantiv Stock

Vantiv stock has just completed a technical price pattern, suggesting that higher stock prices are on the horizon. This pattern is being reinforced and reaffirmed by a bullish momentum indicator, and let’s not forget that the overall long-term trend is bullish, which creates an investment that is worth getting exited about. I am bullish on VNTV stock and will continue to hold this view as long as the indications on the stock chart support it.