Carvana Co.Long
(CVNA) Consolidation & Continuation
Updated
Subject: (CVNA) Consolidation & Continuation
I've now updated my charting to further reflect my ongoing hypothesis regarding Carvana (CVNA) which points towards consolidation and continuation. Based on multiple key factors, I believe we have reached the presumed bottom of the large pullback on the 4hr timeframe.(ZigZag printed). The top was formed on 12/20/23 at the $62 price target and has since retraced to key Fibonacci levels at the $40 price level. Where it then tested and formed the bottom low on 01/17/2024 at $40.70.
Once price action reached these key levels (golden zone) we saw a pretty immediate shift towards the upside where it has continued to consolidate. I believe CVNA will continue to build liquidity at the $40-$50 price range before retesting resistance closer to the beginning of February. Price has also found support right at the VWAP (White) and is trading above the 200 day moving average (Red). Once the price is able to break above resistance bands at the $50 level, I believe we'll see further consolidation/continuation towards historical resistance at $62.
Both the MacD and RSI indicators support consolidation as well as incremental continuation over the coming weeks. I have continued to profit on cash-secured puts at the $40-$42 price levels. I still believe CVNA is a strong value buy right now at its current levels. Analysts have revised price targets to remain at $60, which further support the aforementioned outcomes. The key factors driving continuation will be CVNA financials, which will be reported on 02/22/2024 - I expect results to the be middle of the road.
Please let me know your thoughts - I'll continue to update as time progresses. Cheers!
I've now updated my charting to further reflect my ongoing hypothesis regarding Carvana (CVNA) which points towards consolidation and continuation. Based on multiple key factors, I believe we have reached the presumed bottom of the large pullback on the 4hr timeframe.(ZigZag printed). The top was formed on 12/20/23 at the $62 price target and has since retraced to key Fibonacci levels at the $40 price level. Where it then tested and formed the bottom low on 01/17/2024 at $40.70.
Once price action reached these key levels (golden zone) we saw a pretty immediate shift towards the upside where it has continued to consolidate. I believe CVNA will continue to build liquidity at the $40-$50 price range before retesting resistance closer to the beginning of February. Price has also found support right at the VWAP (White) and is trading above the 200 day moving average (Red). Once the price is able to break above resistance bands at the $50 level, I believe we'll see further consolidation/continuation towards historical resistance at $62.
Both the MacD and RSI indicators support consolidation as well as incremental continuation over the coming weeks. I have continued to profit on cash-secured puts at the $40-$42 price levels. I still believe CVNA is a strong value buy right now at its current levels. Analysts have revised price targets to remain at $60, which further support the aforementioned outcomes. The key factors driving continuation will be CVNA financials, which will be reported on 02/22/2024 - I expect results to the be middle of the road.
Please let me know your thoughts - I'll continue to update as time progresses. Cheers!
Trade active
This post has aged very nicely - happy to see a good uptick after the upbeat earnings report. I was ultimately expecting middle of the road guidance. From here I believe we'll see the price test resistance at the $70 levels then retest support back around $60-$65. The price has built up a lot of liquidity at that level, it will take a lot to fall past $50 at this juncture. If you're looking for options plays, I would sell cash-secured puts at the $50-$55 levels. Good bang for your buck.
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