Kinsale Capital (KNSL): Charts Signal Bullish Trend Resumption after Corrective Phase

Kinsale Capital (KNSL) Shows Signs of Corrective Phase Completion

Introduction

Kinsale Capital (KNSL) has recently experienced a corrective phase, stemming from an earnings-driven sell-off in October. However, key indicators suggest that this phase may be coming to an end, and that the property and casualty insurer’s bullish trend could be resuming.

Technical Analysis

The stock has demonstrated stabilization above a crucial support level at $335. This level is defined by previous resistance dating back to 2022 and the upward-sloping weekly cloud model. With the price above the upward-sloping cloud, it indicates that the long-term trend remains bullish. Moreover, there are indications that the corrective phase has matured, paving the way for a resumption of the long-term uptrend.

KNSL’s weekly stochastics show an oversold upturn, a relatively rare signal that has only occurred four times since the stock’s IPO in 2016. Historical analysis reveals that each occurrence presented a favorable entry point for several months or more.

Last week, KNSL was able to surpass initial resistance from the 50-day (10-week) moving average, resulting in a breakout. This breakout is accompanied by a positive shift in short-term momentum, providing support for further upside movement in the near term. Minor resistance near $376 is seen as surmountable, with only minor resistance levels remaining below the final resistance level near $458.

Further Research

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