52 weeks range
$ 41.97 - $ 80.75
7.3m / 15.1m
After a strong recovery throughout 2020, Twitter started a downtrend from February 2021 that took the stock from $ 80 to the most recent $ 41, making it one of those stocks with negative YTD performance.
Analyzing the current price of TWTR at $ 42.65 we can see that it not only coincides with the bottom of the bearish channel but also with strong resistance/support levels of August - September 2019 and September - November 2020.
Looking at the MACD and RSI indicators: both are very extended to the downside with RSI widely oversold at 17.40 and a sharp bearish trendline that started in October 2021
The 9MA is playing a strong role of resistance and it is especially in the last few months that the stock fails to close above it: a break could be the first indicator of a change in trend in the short term, as happened in May 2021.
At the current price, we estimate a close above the 9MA in region of $ 46-48.00 price range which could therefore coincide with the start of a long position.
Looking at previous swings, we place the first target on the top of the bearish channel at $ 62.00.
A break and close above it, supported by an increase in volumes, would lead to overcome the bearish channel and a possible change in trend. In that case, we the second target at $ 80.00, the previous high.
To conclude, we believe that the current price represents an interesting price range to start building a long position on a stock that, despite being in a bearish trend, could soon consolidate in view of a bullish momentum in the short to medium term.
Entry range $ 114.00 - $115.00
Target 1 $ 156.00
Target 2 $ 170.0
Stop loss $ 95.00
OTB Global Investments
3 December 2021