From a technical perspective, Reddit Inc. (RDDT) is looking like an interesting pick, as it just reached a key level of support. RDDT recently overtook the 20-day moving average, and this suggests a short-term bullish trend.
A well-liked tool among traders, the 20-day simple moving average offers a look back at a stock’s price over a 20-day period. This is very beneficial to short-term traders, as it smooths out short-term price trends and gives more trend reversal signals than longer-term moving averages.
Like other SMAs, if a stock’s price is moving above the 20-day, the trend is considered positive. When the price falls below the moving average, it can signal a downward trend.
RDDT could be on the verge of another rally after moving 40.4% higher over the last four weeks. Plus, the company is currently a Zacks Rank #1 (Strong Buy) stock.
The bullish case solidifies once investors consider RDDT’s positive earnings estimate revisions. No estimate has gone lower in the past two months for the current fiscal year, compared to 11 higher, while the consensus estimate has increased too.
Investors should think about putting RDDT on their watchlist given the ultra-important technical indicator and positive move in earnings estimate revisions.
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Reddit Inc. (RDDT) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
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