TEAM over 240.26Relative strength on last week's market weakness, can break higher out of this descending broadening formation. Cloud/software/cyber security names looking strong into this week, we'll see if this sector gets rotation.
SAAS
SNOW READY FOR A BLIZZARD !1! Snow on the daily is getting squeezed by a bullish pennant . MACD is looking ready to flip along with squeeze momentum finally finishing its sell off. With declining sell volume as well and SNOW consistently holding up its long term support line we could see SNOW gap up to its first price target of $330. Along with the trend analysis as seen we also have to take into account NASDAQ:MSFT earnings report released today stating that they had a 17% revenue increase because of cloud business. The future is SaaS and SNOW is looking ready to snow some cash !
AYX - Triangle patternAlteryx, Inc. provides self-service data analytics software platform. Recorded bad earnings last quarter and has wild 15-20% swings. Short interest is 8.7 %. I like this triangle pattern to breakout, as in my last post MSFT will post good earnings and benefit tech stocks next week.
GDRX - Bullish pennant forming on dailyGoodrx is in the cloud software healthcare sector. Nice looking bullish pennant (lower highs , higher lows) on daily with over 28% short interest. Finviz has a $48 price target. Microsoft has earnings next week, so they should push all SaaS/Cloud stocks next week. Good luck!
DBX watch breakout from previous MA cross over areas NASDAQ:DBX
Watch out for area b/t 2 red line, previous heavily traded area, if price can stay in b/t for another 20-30 days, all MAs will be aligned for a huge run-up.
If rush up too much, then maybe a false break out since 200MA still huge resistance to the price
Sentimental :
lots of youtubers pumping it. SAAS overall high value VS DBX "poor" P/E ( due to its poor profitability ( maybe a take over? )
DDOG over 99.61ConThis has moved well and been a nice trade up from the 90s and looks to continue beyond the psych level of 100.Confluence at the fib and VPOC at the 103.50 area can serve as a first target, second above at 110.92.
FEYE over 15.29Nice IH&S setup with a big move that didn't hold, may need to find support before trying again.
Cup and handle, primed for a big moveA strong name recently that has consolidated over the past week and a half with some sharp moves up that were not held. A break should yield a large move. Major and minor fibs marked above.
Another IPO bounce playAfter a disappointing post-IPO performance, this may be finding bottom, tightening price action may lead to a large upside move.
Support of a volume shelf with a clear path upwardAfter consolidating, ADSK has the potential for a technical-based move upward to the top of this trend line.
Bullish ascending triangleReliable pattern, slow sto oversold, name is showing strength and looks to break to the upside. Aggressive entry over 148.47, safe entry over 153.10, even safer entry over 153.90.
Zoom up 750% YTD and a market cap of $165 BILLIONZoom now has a market cap of $165 billion. It's 750% YTD and trades at a price-to-sales ratio of 126. Wow! I don't remember the last time I saw a stock rip like this with that kind of valuation and market cap. It is truly impressive, but also possibly slightly overextended. I have no position, but am watching closely. Zoom has become THE barometer for economic activity and work-from-home trends.
A price-to-sales ratio of 126 makes no sense to me. Even if they double their revenue over the next 12 months, they will still have a PS ratio of 63. And then if they double their revenue AGAIN, they will have a PS ratio of 31.5. This is possible, but those are some loft expectations. But this market knows better than I and it seems a lot of people have strong conviction in these companies to continue expanding and growing. I wrote something similar about Twilio the other week and it's already up a cool 10% since. No matter how overvalued you think these companies might be, the opportunity is perfect for them to continue growing, to make acquisitions, and to invest in new areas with cheap capital.
One thing to keep in mind is that Cisco has a market cap of $165 billion. Yet they pay a dividend, have cash, and do almost 10x more in revenue. However, Cisco is not growing as fast as Zoom. The question becomes: will Zoom keep growing and taking market share from Cisco and others? Let's find out. I'll be watching and thanks for reading. I hope you found this interesting and insightful.
Cloudflare Long Forever?Cloudflare continues to look great.
I own shares.
$FSLY NYSE:FSLY had a monstrous day today and with Cloudflare being their closest competitor with a larger percentage of CDN market share, it makes sense to long Cloudflare as well.
Orange trend line turned support
The SaaS boom - Twilio at $40+ billion market cap!One company that I have always checked in on is Twilio. They send text messages on behalf of companies for two-factor authentication and other services like chat bots and custom messaging strategies for marketers or companies to communicate.
It is a cool company and it is definitely impressive. Hat tip to what they've started. And look at this boom. Now worth $40 billion.
They generate about $1.5 billion in revenue per year at the moment. So if you do the math, you can see they are trading somewhere in the realm of 30x-35x revenue. If they double their revenue in a year, they will be at at 15x revenue. If they double it again they will be at 7x revenue. And if they double it AGAIN they will still be at about 3.5x revenue. Those are some seriously bullish expectations and while maybe it is possible, I'm not sure I see the risk-reward here going forward.
Perhaps they could acquire some revenue and build new products to expand faster. However, that's also not talking about the rise of competition. Twilio is not the only company that does this. There are few big names emerging and as the tech becomes more known and understood, this should only increase with some companies potentially doing it themselves instead of using a third-party vendor.
Anyways, that's my quick report. Congrats to Twilio longs and the company in general. I am still watching it as I believe it is a good barometer for the SaaS space. But, my core takeaway here is I don't see the risk-reward to the long side and will be watching for some weakness to potentially make a small, calculated trade toward the downside.
Thanks for reading!
May reverse after disappointing post-IPO decreaseAfter hitting a high of 64.40 shortly after IPO in July 2020, price action has been descending over time recently hitting all time lows with the recent market pullback. Some initial indicators that the bottom may be in with a recent curl upwards and a close over the 5 day EMA. Its oversold and may bounce from here, especially on a rotation back into cloud/SaaS stocks. Of particular interest is the marked gap above.
Towards the fundamentals, JPM Analyst Mark Murphy said that the 34% pullback in the shares since August 6 "creates asymmetric upside potential" according to this coverage: seekingalpha.com
BIGCOMMERCE +35%Buy now
Sell levels on the chart
Profit 35-60%
Stop-loss if breakdown trend and RSI
Wish you luck !
APPS - breaking OUTAPPS is breaking out of its parallel channel; with a 10% move; while the technology keeps going down.
I have not seen any news that could create this move today.
Intraday volume has been above average by 70%. (tool being patented by Schwab)
RSI is oversold, but as we saw earlier, APPS doesn't mind reaching 90 level. Looking for a strong close today to enter a small position.
Fortinet at important supportWe are seeing confluence of support around $120 approximately.
Test 1: February high
Test 2: Bottom of gap
Test 3: 200sma
Risk Reward ratio is great, as we can set a stop below the 200sma.
RSI is still not oversold on such a drastic down movement.
