TWITTER to buy or not to buy

S&P: Bears out of hibernation
February 4, 2014
Βραχυχρόνια ανάλυση του Γενικού Δείκτη και της Εθνικής Τράπεζας
February 6, 2014

Today after the market close Twitter will announce its Q4 2013 EPS which are expected at -0.02. Current option open interest suggests we should expect a move of + or – 10$ towards 75$ or 55$. Of course the safest way to treat this is to stay cash and wait to see what will happen when the market opens on Thursday and play accordingly. Technically 55$ is important support that was back tested a few days ago and prices made a double bottom that brought the share price above the short-term resistance of 65$.

twtr

From the Elliott wave perspective the rise from 38$ is impulsive and the decline from 74.73$ is corrective. Clearly we see 4 waves down from the highs. The rise from 55.59$ is not a clear impulsive wave but we can label it as one. The next decline was again corrective and did not break the beginning of the upward wave. The upward bounce made a higher high and we can say that there is increased probability that prices have started their next upward move and the low is in. If earnings surprise we could see a sharp rise towards 75$ and why not 80$. If results disappoint we could see a second pull back towards 55$. If prices break below 56-55$ we should expect  low 50’s to be tested where the daily Ichimoku cloud support is.

twtrD

On the daily chart we see an increased volume bar around the 55$-65$ price range. This confirms we are at an important price level. Technical and Elliott wave analysis slightly favor bullish positions and the continuation of the up trend. How one can treat this also depends on the level the investor has bought TWITTER. If I was long from the lower levels of the price range 55$-65$ I would probably risk holding on to my long position. The higher my entry point was, the less possible would be to hold on to my shares after the close. For more analysis and my real-time trades announced through our exclusive for members twitter account become a member today.

As always, thank you for taking the time to read my new post.

Alexandros Yfantis
Alexandros Yfantis
Fascinated by financial markets, studied International Securities Investment and Banking in the UK, works as a Portfolio Manager in Greece and runs a technical analysis website. Enjoys travelling and spending time with his family and preparing for the black belt in Korean Karate.