(MENAFN- Daily Forex) Long Trade Idea

Enter your long position between $67.74 (the lower band of its horizontal support zone) and $69.09 (the upper band of its horizontal support zone).Market Index Analysis

• The Coca-Cola Company (KO) is a member of the Dow Jones Industrial Average, the S&P 100, and the S&P 500 indices.
• All three indices push to fresh highs on the back of the AI bubble, but bearish volumes are rising.
• The Bull Bear Power Indicator of the S&P 500 is extremely bullish and suggests upward exhaustion.

Market Sentiment Analysis

The Federal Reserve delivered the expected 25-basis-point interest rate cut, but Fed Chair Powell poured cold water on a guaranteed interest rate cut during its last meeting of 2025 in December. Equity markets gave up earlier gains, except for the NASDAQ 100 Index, where the AI bubble continued to expand. Equity futures are lower this morning after President Trump and President Xi met in South Korea, failing to deliver the bullish catalysts investors had hoped for, as Microsoft and Meta sold off after their earnings reports, but Alphabet countered some of the losses Company Fundamental Analysis

The Coca-Cola Company is one of the world's largest beverage companies, with a recent push into healthy alternatives and bottled water. It began paying dividends in 1920 and, as of 2019, has increased its dividend payout for 57 consecutive years. It also has high brand loyalty.

So, why am I bullish on KO after its earnings beat?

Coca-Cola reported an earnings beat, with revenue coming in at $12.62 billion versus estimates of $12.54 billion on the back of strength in its European segment, which offset weakness elsewhere. Net income rose to $3.81 billion or $0.88 per share from $2.41 billion and $0.56 per share one year ago. I am bullish about its pricing power, market position, and profit margins, which should drive its share price higher.

Coca-Cola Company Fundamental Analysis Snapshot

The price-to-earnings (P/E) ratio of 22.63 makes KO an inexpensive stock. By comparison, the P/E ratio for the S&P 500 Index is 30.97.

The average analyst price target for KO is $78.83, suggesting moderate upside potential with decreasing downside risk Company Technical Analysis

Today's KO Signal

Coco-Cola Company Price Chart

• The KO D1 chart shows a price action entering its horizontal support zone.
• It also shows price action between its descending 50.0% and 61.8% Fibonacci Retracement Fan levels.
• The Bull Bear Power Indicator is bullish with an ascending trendline.
• The average bullish trading volumes are higher than the average bearish trading volumes.
• KO corrected as the S&P 500 recorded fresh highs, a bearish trading signal, but bullish catalysts have accumulated.

My Call on the Coca-Cola Company

I am taking a long position in KO between $67.74 and $69.09. KO has high brand loyalty and pricing power. Investors benefit from a reasonable dividend yield, industry-leading return on equity, and superb profit margins.

• KO Entry Level: Between $67.74 and $69.09
• KO Take Profit: Between $74.38 and $78.83
• KO Stop Loss: Between $64.65 and $65.35
• Risk/Reward Ratio: 2.15

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