Equifax, Inc. (EFX) closed at $188.18 after falling sharply. The move follows a break of a multi-year upward trend on the daily chart.
From late 2023, the share price rose along an ascending trendline for nearly two years. It reached highs just above $309 by mid-2024, with the trendline supporting price on multiple tests.
After the breakdown, the same trendline now sits above price and may act as resistance. The drop from just above $309 to $188.18 is roughly 39%.
Price is now between the overhead trendline and a support level at $159.93. The gap from $188.18 to $159.93 is about $28, or nearly 15%.
A recovery would require a move back above the ascending trendline. If the price fails to clear that level, a decline towards $159.93 remains possible.
Trading decisions may depend on whether price reclaims the trendline or breaks below $159.93. Volume and momentum are key measures to monitor during any consolidation or further decline.
With Equifax having broken its multi-year uptrend, we see the stock in a vulnerable position at $188.18. For derivative traders, the immediate focus is on the strong overhead resistance formed by the old trendline and the key support level down at $159.93. The coming weeks present a clear choice between betting on a continued slide or attempting to catch a rebound from oversold conditions.
The bearish case is supported by recent economic data that points to growing consumer stress. We have seen reports that U.S. credit card balances soared past $1.1 trillion by the end of last year, while serious auto loan delinquencies have also climbed to levels not seen since the mid-2000s. This environment could negatively impact Equifax’s revenue from credit inquiries and data sales, making a test of the $159.93 support level seem more probable.
For those expecting further downside, buying put options with March or April expirations and strike prices like $175 or $170 could be a direct way to play this move. Another strategy is to sell call credit spreads with short strikes above the broken trendline, perhaps around the $200 level. This approach allows traders to profit if EFX simply stays below resistance, benefiting from both time decay and a potential price drop.
On the other hand, traders who believe the 39% decline is excessive might see an opportunity here. Selling cash-secured puts with a $160 strike price is a less aggressive bullish strategy. This allows one to collect premium now, with the obligation to buy the stock only if it falls to that major support level, effectively setting a lower entry point.
A more direct bullish play involves buying call options, but the recent sharp price drop has likely inflated their implied volatility, making them expensive. Looking back at similar market drops we saw in 2024 and 2025, buying calls right after a plunge often required precise timing to be profitable due to the high premiums. A call debit spread could be a more prudent approach, as it would lower the upfront cost and define the risk if the stock fails to bounce immediately.
