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Data Signaling Pause for TWTR

This post is for informational purposes only. Not trading or investing advice.

Sporting big gains, Twitter Inc (NYSE: TWTR 45.80 -0.96 -2.05%) has been all over business news. Sentiment says it's heading over $50. NOW. What's the data saying?

Friday, TWTR appeared in our Stage Analytics technical events: the stock is backing off relatively high MACD momentum. It could reaccelerate on Monday, but a related same-day event, XLK MACD line/ Signal line crossover, says sector momentum isn't supporting that outcome.

Custom Stage 2 Analytics - Notes tab

Daily technicals for TWTR turned supportive in May's fourth week. The Z score maximum divergence relative to price (far right column below, vs Close), for a rolling 10 day period, peaked on May 22nd. It became aligned by June 1st; from there, the stock ran 10 points.

The current-period (bottom right) shows weaker technical support, most notably Acc/Dist, OBV and RSI. This subtlety is difficult to eyeball on a chart.

In this view, we also see increasing volatility, with price inside of Bollinger Bands (standard 20,2,2 settings), and gradually increasing MACD momentum into Thursday's 125-period max.

Custom Stage 2 Analytics - Focus tab featuring TWTR

TWTR's technical alignment versus other tickers in my list, while off its best levels, is still relatively high.

Custom Stage 2 Analytics - Sort tab

Analytics is as much about texture, and getting a sense of probabilities, as it is about clear triggers and automation. The Stage Analytics Comp tab is dense with information.

A quick summary: TWTR closed Friday below Thursday's pivot point. RSI and Stochastics remain overbought. TWTR recently resumed outperformance in a sector that's been crushing the SPY. The SPY is vulnerable to negative MACD divergence. TWTR is relatively far from breaching its upper Bollinger Band. But, the MACD offers support to the stock.

Custom Stage 2 Analytics - Comp tab featuring TWTR, XLK and SPY

Pull up a daily chart of TWTR; you will see an unfilled gap ~38. That level also also represents previous resistance. Could that pull the stock from below?

The texture of Twitter's daily price, volume, technical, relative and statistical data signals the stock may pause, retest lower levels. Then again, sentiment could overwhelm traders and send the stock soaring over $50.

     by Jay Beckner

 

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IdeasJay BecknerTWTR, XLK, SPY