Zoom Video Communication Daily Chart.
Shares of Zoom Video Communications (NASDAQ:ZM) have been battling heavy resistance near its 50-day moving average since Nov. 30. The stock took a nasty post earnings spill (-15%) the next day leaving behind a huge breakdown gap. ZM trended lower over the next six weeks extending the pullback from October’s all-time high to 42%. This deep selloff retraced nearly half of the stock’s entire 2020 range. We highlighted this major support zone here. ZM fell within $5.00 of hitting $326.00.
In mid-January ZM had returned to its declining 50D but was unable to punch through. Until today. ZM is closing out the week with a 6% gain as it begins to put some distance on the January high. We expect more upside in the near term. Initial target is the $478.00 area (12/1 breakdown gap). On the downside, a close back below this week’s low ($368.00) would indicate more choppy action ahead.
Note: We are long ZM in our Tactical Opportunity Portfolio.
You can read Gary S. Morrow's original post here.
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