Pepsi stock looking for support

Stocks have been gaining all week since the S&P 500 gaped-up 1.78% from last Friday's close to Monday's open. Communication stocks such as Electronic Arts (EA) and Disney (DIS) have been leading this week's rally as some consumer staples such as Pepsi (PEP) have been dragging gains.

Comeback kid

In March, shares of Pepsi closed at their lowest levels in over a year at $103. Pepsi's stock was able to bounce back 27% in ten days after bottoming at $103, but since then shares have traded sideways for the past six weeks.

Pepsi daily chart. Source: TradingView

The soda company's stock has failed to break its $137.50 resistance level multiple times, but continuously finds support $130 before re-testing resistance. There's been enough support for shares to always close above $130, but the stock is now closing below its 50-day moving average for its third consecutive day. A close below $130 will confirm a downward slope where shares will probably rally between $125 and $127.

Trading volume is relatively low today compared to past sessions, so sellers may be exhausted. Shares could easily bounce off support and go to test $137.50 as its done two other times.

Pepsi is trading on support and is desperately looking for buyers to stay above $130. Shares probably won't hover on the support level for long, but dramatically bounce off or fall through the level. Be sure to keep an eye out for the stock's next move, financial movers.