Not financial advice.
The essence of investing & trading is the intelligent and patient preying on the greed, fear, impatience, addiction and ignorance of the majority. It's definitionally Darwinian.
Unfortunately, COVID darling ZM ZOOM looks to be headed to the 107 area and possible 100 over the next few weeks. A relief bounce could temporarily get it to the $170 range, but ultimately will fail. I'm a buyer for swing shorts on any green day.
ZM is in downtrend and near to its Fib 78% support level also at current channel bottom.
Bearish Indications:
1. Lower Lows and Lower Highs
2. Big Marobozu Candle
3. Fib 78% level is 173.93
4. moving in a channel
5. AB=CD pattern if completes (target around 93)
Looks good for shorts above green line. Stoploss above white line. Targets are lines below green. This is not financial advice. This is record keeping only.
Head and shoulders pattern.
1. Company issued more shares, retail investors cheered but more shares are typically bearish.
2. Post pandemic use will remain high, growth however seems to be diminishing, even with zoom phone.
Opinion: Prices will hover around the SMA50 but fail to break higher. Prices will eventually turn towards the downside.
This is what I think will happen with zoom over the next few weeks.
We will continue to bounce from here and potentially hit my identified reversal zone.
Look at my blue and yellow fibs there for confluence.
My purple fibs are my elliott wave projection fibs which are currently estimating A=C. wave C could easily head to the purple 1.618, at which point we...
Break-down through neckline could lead to >-50% downside.
Stock is still trading on > 130X current (Fy21) no-gaap eps guidance.
Don't get me wrong, It is a good company offering good product. ZM (and GSX) were the only 2 buy-and-hold stocks I suggested to my hedge fund clients in late 3Q19.
From a user perspective, (I am currently a CFO at startup doing M&A),...
ZM could be a fast mover bc of market volatility due to covid updates, so be catious. Wait for the market to decide the direction and ride!
Zm tends to respect levels.
Puts under 434, targets: 422.55, 396.19, 367.27
Calls over 445, targets: 476, 505.20, 539.91
Bull Case: Double Bottom
Target $536+
Bear Case: Bearish Flag Pattern
Target $480
I hold $600 call for next week.
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Look at that long, steady rise in RSI. We'll be triple-topping soon and I don't expect it to pullback and retest after it pops above $516 - next stop 525-530. If price breaks above $530, expect price action to go full parabolic similar to September 23. Sellers will be quick to jettison the second any weakness appears on the 2-min charts. Once RSI breaks above 70...
