Boingo (WIFI)
For the last several weeks, we pointed out the setup in Boingo (WIFI). A cup & handle pattern was forming, and last week we spotted the bounce and trend reversal exactly at the 127.2% extension, which is a common place to spot short term trend reversals.
So far, the uptrend has been a healthy one – buying pressure increasing with price and volume increasing. This signals that more buyers are showing up just before the resistance.
Today, WIFI broke through our targeted breakout region, closing on the high at $13.98 with double the average trading volume. The internals are confirming what we are seeing – buying pressure is increasing with price and volume.
If WIFI can hold above this level tomorrow (Friday, Feb 14th), that will be a strong confirmation of a breakout, and the move from here could be swift. We have provided good setups in the past leading up to this moment; if you do not have a position in WIFI and have been waiting for a breakout, this is what we have been waiting for.
We are raising our stop to just under $10.70 to protect our gains.
Slack (WORK)
Last week we noted that Slack was appearing to stall-out again within the range it has been stuck in for several months between $25-$20.
With decreasing momentum and a reversal at the 20% symmetrical tops we outlined in Slack’s prior attempts to breakout, we were planning on price, once again, retesting the $20 support. However, an announcement surrounding IBM as a listed client of Slack changed this setup. On heavy volume, Slack broke right through the strong resistance that has halted all attempts prior.
This move did so with the MACD supporting a healthy trend as well as the MACD-Histogram showing an increase with each attempt by buyers to push prices up. Both the MACD and the Histogram are making new highs, while price is breaking through its range on strong volume. This is the type of breakout we want to see and one that you should pay attention to.
Furthermore, the resistance zone that kept Slack bottled up is now support – So, $25-$23 is now the primary support zone for any continued uptrend. After breaking out, Slack attempted to retest the now support zone between $25-$23. This move was quickly rejected, which is also a bullish sign.
As of now, it appears as though Slack is in a well-defined bull flag pattern that has been confirmed by today’s close. All of these signs point to a healthy breakout. We went long on the breakout and have a tight stop at $24.25.
Chainlink (LINK)
Since bottoming just above our stop at $1.60, Chainlink (LINK) revealed a micro 5-waves up, which is a sign of a potential turnaround. On December 12th, we announced on the forum the setup, which was that we are going long at $1.80 with a stop at $1.60. Since then, we’ve added to the breakout above $2.
My current count on Chainlink has us in a strong uptrend with plenty of room to run. Chainlink recently broke out again at $3.40, making a new higher high within the range it was trading in. The next stop will be all time highs at $4.80.
The internals are all confirming a healthy uptrend, and LINK is a buy on pullbacks or breakouts. The 34-day EMA (the red line) has been the support since the renewed uptrend off the December 2019 lows. Any break of this trendline will signal a correction is underway, and should be monitored closely. We are raising our stop to just under $2.6 to protect our gains, in the event the current uptrend fails.
I posted my long-term targets in red on the chart. As long as LINK does not break down below $2, this target remains my long-term plan for now. Alt coins, like Bitcoin, are notorious for false breakouts and failed impulses. So far, the structure we are seeing is promising and is the type of trend we want to be invested in. With a asset this volatile, stops and position sizing are crucial. Even if do get a failed breakout, we will lock in a nice profit at $2.60, and wait for the next uptrend.
Please note that LINK is not a typical crypto as it’s tied to smart contracts which will be first in play for blockchain with smart contracts gaining a lot of interest from the finance industry. Reference the Chainlink PDF for more information.
Bitcoin (BTC)
In our first report on Bitcoin in August of 2019, we outlined that both the fundamental story is aligned with the technical story. We may be in the early stages of a larger degree third wave, which we have been following and covering closely. When confirmed, this will take us to all-new highs.
The above chart shows this long-term pattern, starting from the bottom of Bitcoin’s all-time top and roughly 85% drawdown. On the forum we spotted the most recent bottom and initiated a buy around $7100.
It’s worth noting that a close above $10,000 is a big deal for Bitcoin. Historically, it has been a psychological region of importance. The chart above outlines my general game plan for Bitcoin, and as long as we hold the $7,000, this will be my primary count and remain my game plan.
Another scenario is that Bitcoin pulls back, which will take us to the low $9000-low $7650 region.
MongoDB (MDB)
The internals are suggesting that MDB is stalling out as it approaches new highs. We have divergences across the MCD Histograms and the RSI. The MACD signal is on the verge of crossing over to the downside as well. All of this is happening while the price is making higher highs. This is not what we want to see from a stock poised to breakout to new highs.
For any current longs, the 34-day EMA has been solid support for the current uptrend, which is currently at $155. If this support is broken, I’d be looking to the 200-day SMA for the final support, currently at $142.
Roku
Roku has been trading within a descending wedge pattern since December of last year. We had a false breakdown in late January where the price tested the 200-day SMA (red). The next day the price went back into the range.
Prior to beating earnings, the price broke out of the wedge pattern to the upside, closing for 3 days above this breakout. The internals confirmed the move with an increase in buying pressure and volume.
Tomorrow, we will likely see a gap-up at the open. As of now, the price is set to open within the green resistance zone around $147. We will want to see Roku clear the $153 price target as the first hurdle, and then new highs before we can say the bullish trend is renewed. Long term, Roku has been and remains one of our highest conviction plays due to size of addressable market.