GoPro: A Technical Breakdown
GoPro shares have had a nice rebound after the strong fall from COVID 19. The question remains does that strong increase continue to run or is it due for a correction?. We’ll be looking at some technical details to try and better understand any underlying trends and what this might result in for the stocks future. The price is likely to change following the earnings report later today with many analysts remaining skeptical and cautious about the impact the recent downturn in the global economy has had on the company.
The moving average is a price based indicator that shows the average price of an asset over a certain period of time. The 20 day moving average shows the average price over the last 20 days, and likewise with the 50 day moving average. By using these lines we can demonstrate a trend in the price of the asset and use that to help analyse the stock. If we compare one line against the other we can find the key points of intersection between the two. If the smaller day moving average intersects the larger day moving average we get a “buy” signal. As it is with GoPro we can see that the 20 day moving average recently intersected the 50 day moving average indicating a buy.
The Moving Average Convergence (MACD) is a trend momentum indicator that shows the relationship in this case between the 12 day and 26 day moving averages. It is commonly used as a buy or sell signal. In this case the MACD (blue) has crossed the signal line (red) and has managed to stay above the signal line to this day. Therefore this crossing indicates a “buy” signal.