Comerica Incorporated, located in Dallas, Texas, is a well-known financial services company that offers commercial banking, wealth management, and retail services. The long-term trend for Comerica shows a potential reversal on its weekly chart, marked by the completion of an Inverse Head and Shoulders pattern. This pattern suggests a target price of $119.78, indicating strong upward potential as long as the chart remains stable. However, short-term indicators show that the stock is currently overbought, making it riskier for those trying to capitalize on recent price increases without a period of consolidation. For potential buyers, the chart highlights three entry points depending on their risk tolerance: – **Aggressive Buy Level**: $83.55 – Great for those confident in the ongoing momentum. – **Moderate Buy Level**: $76.75 – Offers a better risk-reward balance, allowing for a partial price retracement. – **Conservative Buy Level**: $70.40 – Aligns with major support and provides the safest option, as it uses previous resistance turned into support as a guide. These buy levels cater to various risk preferences, and market movements may require a pullback to maintain gains. We are witnessing the completion of a significant bottoming pattern in Comerica, indicating a shift to a positive long-term trend. The chart suggests a possible target price around $120, presenting a clear, long-term bullish goal for our strategies. After a strong increase of over 25% in late 2025, the stock seems overbought. Jumping on this price surge now carries risks, and a pullback to digest those gains is likely. The Federal Reserve’s shift away from interest rate hikes last year helped fuel this rise, but we now need to wait for a better entry point. In the upcoming weeks, selling cash-secured puts with strike prices near $76.75 is a smart strategy. This allows us to earn option premiums while waiting for a pullback into a more favorable buy zone. We could also buy short-dated put options to profit from an expected near-term dip. Recent economic data supports this cautious approach. Late 2025 manufacturing reports indicated a slight slowdown in business activity, which aligns with the need for the stock to pull back before it can resume its upward trend. We can leverage this expected short-term weakness to our advantage. Our main goal is to use this consolidation phase to prepare for the next upward move. A test of the old resistance-turned-support neckline around $70.40 would be an ideal opportunity. At that point, we would close any short positions and start buying long-dated call options to target the $120 price goal.

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