*TA as of 7/3/24
Hi everyone! I’ll be looking at another fintech company in this post:
Affirm Holdings, Inc. (NASDAQ: AFRM)
AFRM is trading in a series of higher highs and higher lows since May 2023. It was trading in an ascending channel (black) before breaking out and filling the 51.49 imbalance from March 2022. It is now trading in a consolidation pattern, namely a descending channel (red) and forming a series of lower highs and lows.
Now, let’s take a closer look at the descending channel. The stock is currently basing at the 36.12 support where it formed an imbalance in December last year. It has formed a small bullish divergence here, which is indicative of a move higher in the short-term. From the looks of it, we could now be moving towards the 47.44 imbalance that we formed last month. I’ll be watching for a rejection at the upper trendline and a lower high below 49.99. If we get that, then we will see a test of the 32.81 level, as well as a > 50% retracement taking a swing low of 15.97 and a swing high of 52.48.
However, if we manage to hit 47.44 and form a higher high, then we are headed back towards the top of the channel at 52.48 before pushing towards the 83.57 imbalance in the longer term. For now, AFRM appears indecisive in what it wants to do, but its long-term direction is much clearer.
Sentiment: BUY
Summary (with Price Targets - NFA):
Short-term descending channel consolidation pattern with a long-term measured move towards 83.57. A rejection at 47.44 and the formation of a lower high will most likely see a retest of 32.81, while a higher high above 49.99 will see the long-term measured move play out.
Investors can consider accumulating at current levels. If we do reject at 47.44 and head towards 32.81, it will provide another opportunity to accumulate shares. Can consider accumulating a starter position and add more only if we break out of consolidation.
All right, that’s all for this newsletter. See you in the next one!
$Affirm Holdings, Inc.(AFRM)$ $SoFi Technologies Inc.(SOFI)$ $PayPal(PYPL)$ $Upstart Holdings, Inc.(UPST)$ $ARK Fintech Innovation ETF(ARKF)$
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