I have been following this particular stock for the last month, and notice that the long-term trend could be about to reverse. As everybody know, this is obviously the kind of stock that requires a lot of attention and has some risk given its industry, but on a trading basis and based on the high volume that we have witnessed in the last sessions the risk to reward looks attractive at current levels.
On the daily chart the stock closed last week above the 200-day exponential moving average for the first time since August 2015, which shows the the bulls are gradually regaining control over the daily bar chart pattern. That key EMA will be the first line of support for next week if the current uptrend reverses.
Daily technical indicators are looking bullish. The MACD indicator is still positive and rising above its signal line. RSI and Slow stochastic have climbed to the edge of its overbought zone. For the upcoming week i expect some consolidation or correction above the 200-day EMA before the next leg of the up move. The stock has gained more than 15% in the last 3 sessions, so some correction or consolidation can’t be ruled out. The next higher target is the $20 area.
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