Analyzing The Chart Of This Year's Top Growth Stock: Shopify

TL;DR

Shopify has been a top performing growth stock, doubling in value since February. It experienced a consolidation phase before breaking out and has shown consistent growth. Despite short-term fundamental weakness, analysts expect strong earnings growth in 2020.

Transcript

as investors prepare their portfolios for a new year it's important to take a look back and study the stocks that made the biggest moves that way you can analyze when would have been the best time to buy and the best time to sell that kind of post analysis is invaluable when it comes to improving your trading skills so you can keep an eye out for w... Read More

Key Insights

• 🥺 Shopify, a leading ecommerce software, has experienced significant growth and performance in its stock throughout 2019.
• 🤪 The stock went through a consolidation phase after a massive price increase, indicating a new setup for another price surge.
• 📶 Shopify's stock has shown bullish signs, such as finding support at crucial moving averages, which indicate strength and opportunities for adding shares.
• 💪 Despite short-term fundamental weakness and a diversification of its business model, analysts expect strong earnings growth for Shopify in 2020.

Questions & Answers

Q: What signaled Shopify's potential to be a big winner before its breakout?

Shopify's relative strengths line hitting new highs before the stock's price highs signaled its potential for success. This is a bullish sign indicating strong price performance compared to the S&P 500.

Q: How did Shopify's stock perform after the breakout?

Shopify's stock had a picture-perfect run, finding support at the 10-week moving average and experiencing significant earnings growth over the next two quarters. It rose from $177 to $409 by late August.

Q: What was the clear sell signal for Shopify investors?

When Shopify shares broke below their 10-week moving average in heavy volume, it marked a clear sell signal for investors. This indicated that the stock was ready for another break and needed consolidation.

Q: What buying opportunities have been presented for Shopify investors?

Recently, Shopify climbed above a $349.54 buy point from a double bottom entry, presenting a buying opportunity for investors. Another potential buying opportunity could occur if Shopify forms a handle on its way to approaching prior highs.

Summary & Key Takeaways

• Shopify is a top performing growth stock that has doubled in value since February, with strong earnings and revenue growth.

• The stock experienced a consolidation phase after a significant price increase, which created a new setup for another big move.

• Shopify's stock has shown a picture-perfect run, finding support at the 10-week moving average and experiencing strengthening fundamentals.

• After a heavy drop in stock price and a break below the 10-week moving average, Shopify found support at the 200-day line and presented a buying opportunity for investors.