Bullish Engulfing Candle!
Reddit Check-In: 4/02/2024
Bullish for Reddit Stock
So far, things are still looking good for Reddit on the technical front. Reddit had a very bullish day while most of the market was very bearish. Reddit's price climbed over 10% at its highest today.
Today's bullish candlestick is the first sign of a possible rebound off of the only support level available on RDDT's chart. I mentioned this technical level in my previous comments about Reddit. Check it out in the link directly below.
Bearish Engulfing Candle
We even saw a bearish engulfing candle. This happens when the candle opens the day lower than the previous day's open and closing price. A bullish engulfing candle also closes the day higher than the precious day's open and close.
This is a bullish development as it shows a day of strong buying. It also shows investors confidence as they were willing to buy RDDT even though the price opened with a gap down to all-time lows of $44.00, and they continued to buy up the stock to higher prices than yesterdays prices. You can see what this looks like in the chart below.
Very Low Relative Volume
Even though today was so bullish, there were not a lot of investors participating in the green day. We saw the smallest amount of volume that we have seen in this ticker so far.
Some would say it is too early to start analyzing the volume as the price action has not had enough time to develop enough data to analyze. Either way, the very small amount of relative volume today could indicate that today's bullishness was somewhat invalid.
Incoming Rebound or Breakdown?
You can see in the chart below how it appears that the price action is rebounding off of the support level I mentioned in my previous post. It is still too early to call the rebound. We need to see more upside. Maybe if we see some follow-through to the upside tomorrow, then we might be able to consider a rebound.
If we do see a rebound, then watch the previous highs for some potential resistance.
Watch for Potential Bearish Formations
Be weary of the potential head and shoulders pattern that could possibly print on the charts in the near future. Obviously, this is nowhere near receiving confirmation yet, but it is always smart to mind the potential bearish candlestick formation.
I Need to See More Before I Flip to Bullish
As long as Reddit stays above support, then things will lean more towards the bullish side. Personally, I am still bearish on this name until I see more bullishness on the charts. As of today, Reddit has basically been trading flat since day one of IPO. So I will keep my bearish stance. If RDDT makes new all-time highs, then maybe, just maybe, I might feel a bit more bullish.
So what do you think, Moo'ers? How will RDDT finish the week? Above all-time highs of $75.00. Between the previous high of $75.00 < $58.00. Above the all-time lows but below the high of day one, $58.00 < $44.00. Will the price drop below all-time lows but above pre-IPO pricing, $44.00 < $34.00? Or will the price crash below pre-IPO pricing of $34.00?
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bic mutney : buy more to avg down!
Pinkki_doll : If technical analysis works perfectly, full time traders should be richer.
SpyderCallOP Pinkki_doll: right, nothing is perfect. if you relied purely on fundamentals, then you might do even worse than a technical trader. Those that trade purely off of the macroeconomic environment and economic data are not perfect either. You must use a combination of technical, fundamental, and macro trading methods. If you consider all three of these variables, and you follow the general trends, then you will do okay, in my opinion.