My Watchlist [65]: LYFT... Poised for a Return to 13.30s before 21.52?
*TA as of 26/2/24
Hi everyone! Here’s an update on a stock I covered specially for you all previously:
Lyft, Inc. (NASDAQ: LYFT)
Previously, I mentioned that LYFT would retest the 11.93 support level first, before a move higher. I was pleasantly surprised to see that this price action played out perfectly. We formed a lower high and some bullish divergence in the process. Post-ER, the stock rallied towards the 18.36 level, forming a higher high in the process. These are signs of a healthy uptrend.
With recent price action in order, I noted that LYFT has been trading in an ascending broadening wedge expansion pattern. The formation of a third higher high came with the formation of a weak “equal-high” bearish divergence, that has cumulated in a pullback.
Moving forward, I am expecting a retest of 13.76 and a gap fill, with the formation of a bullish divergence (either regular or hidden) on the daily. It’s also probable they might overrun this to retrace 78.6% of the move before pushing higher, assuming a swing high of 19.43 and a swing low of 11.69, which was the pre-ER low. A retest of the trendline may or may not happen, so I’ll prefer to look at levels.
Once we get this retest, I expect price to gravitate towards the next level at 21.52. Once we hit those levels, I’ll issue an update on LYFT. In the meantime, don’t get chopped up by the consolidation price action that will take place over the next few weeks.
Sentiment: HOLD
Summary (with Price Targets - NFA):
Trading in an ascending broadening wedge expansion pattern with higher highs and lows. Expected to consolidate down to 13.30s and form a bullish divergence before pushing towards 21.52 in the longer-term.
Investors can consider averaging down into support - the chart only turns bearish if we form a lower low and break through supports.
Alright, that’s it for this newsletter. Till next time!
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