Shares of Prudential Financial (PRU) have been in a consistent downtrend phase for the last three months, bringing the stock down from a peak around $128 in November 2024 to a low earlier this month around $105. A recent bounce has brought PRU back up to test a confluence of resistance, suggesting an impending breakout could lead to much further gains for this insurance name. A trendline formed from the November 2024 and January 2025 swing highs lines up remarkably well with this week's price action, currently sitting just above the $115 level. We can also see that Wednesday's rally saw PRU push briefly above its 200-day moving average for the first time since early February. This week's upswing also brings Prudential back up to retest its most recent swing high in late February, meaning a break above current levels would create a higher high and suggest a new uptrend phase. Price momentum, as measured by the RSI, is starting to demonstrate more bearish behavior, with the most recent rally propelling the RSI above the crucial 60 level. We can see that previous upswings in January and February saw the RSI top out before it reached the 60 threshold, indicating that this most recent rally could indicate an influx of buying power with the potential to drive even higher. Finally, we can see that the rally off the March low created a bullish momentum divergence, with the lower lows in price matched with higher lows in RSI. Lower price action on stronger momentum suggests an exhaustion point in the downtrend phase, which often leads to a new impulse move higher. On the weekly chart of Prudential, we can observe that the most recent low around $105 lines up very well with previous major lows in August 2024 and April 2024, as well as a previous all-time high from Q1 2022. The weekly RSI features a bearish momentum divergence from the first half of 2024, which provided a signal for the impending top and new downtrend that has occurred into 2025. Finally, we can see that the weekly PPO has not yet indicated a bullish reversal, although a signal does appear to be likely in the near future. The last time we saw a bullish signal from this indicator was back in June 2023, just before PRU powered higher all the way to the eventual high in November 2024. With mega cap growth stocks experiencing further pressure this week, we are finding plenty of compelling technical opportunities in value-oriented sectors like financials. Given the potential breakout and long-term trend reversals discussed today, Prudential Financial could provide an opportunity to outperform in a period of market instability. -David Keller, CMT marketmisbehavior.com Get Your Ticket to Pro LIVE Join us at the New York Stock Exchange! Uncertain markets? Gain an edge with CNBC Pro LIVE , an exclusive, inaugural event at the historic New York Stock Exchange. In today's dynamic financial landscape, access to expert insights is paramount. As a CNBC Pro subscriber, we invite you to join us for our first exclusive, in-person CNBC Pro LIVE event at the iconic NYSE on Thursday, June 12. Join interactive Pro clinics led by our Pros Carter Worth, Dan Niles, and Dan Ives, with a special edition of Pro Talks with Tom Lee. You'll also get the opportunity to network with CNBC experts, talent and other Pro subscribers during an exciting cocktail hour on the legendary trading floor. Tickets are limited! DISCLOSURES: (None) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL'S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.
