Twitter has started its trading life with a sharp rise from 39$ to almost 75$. Prices have risen in an pattern from 38.80$ to 74.73$. Prices then started to pull back in a corrective pattern and have already reached the 50% Fibonacci retracement of the entire rise. Prices are making a and lower highs pattern that confirms that trend is down. However the decline is most probably corrective as the price formation is overlapping.
Twitter is now trying to break above the downward sloping trend line resistance that starts from its highs at 74.73$. The price range of 60-64$ is strong resistance not only because of the trend line but also because of the Ichimoku cloud that stands above current prices. Our expectations are bullish. Although we may see another move down towards the 61.8% retracement, we believe that eventually Twitter should make another leg up similar to the rise from its lows to 74.73$. If this move starts from current levels at 55$, we should easily see the 100$ price level being reached if the rise is equal to the first leg up from 38.80$. Usually we should anticipate a rise that is 1.61 times the first one, so measuring an upward move from 55$ which is 1.61 times the first upward move, we should expect prices to reach 112$.
Concluding, we are bullish Twitter for the longer term, expecting it to break above 100$. Assuming that the broader market does not goes into a deep correction and assuming that trend remains up, we should expect to see Twitter above 100$ over the next few months. As always, thank you for taking the time to catch up on my thinking. For more help trading US stocks become a member today.