Crowdstrike Holdings Inc. (NASDAQ: CRWD) shows signs of an upcoming price surge according to its latest charts. CrowdStrike Holdings, Inc. is an American cybersecurity technology company based in Austin, Texas. It provides cloud workload and endpoint security, threat intelligence, and cyberattack response services.
Bullish Indications
#1 Falling Wedge Breakout: The daily chart shows that the stock was trading within a falling wedge pattern during the past several months. This is marked in the daily chart in purple color. Currently, the stock has broken out of this falling wedge pattern. A breakout from a bullish pattern like Falling Wedge Pattern shows that the stock has gained momentum and has the potential to move further up.
CRWD – Daily Chart
#2 Trading Above MA: The stock is currently trading above its 50-day moving average, indicating a bullish bias for the stock in the short term.
#3 Bullish ADX and DI: The ADX indicator shows bullishness, as the (+DI) line is currently above the (-DI) line, and the ADX line is currently moving higher from below the (+DI) and (-DI) lines.
#4 MACD above Signal Line: The daily chart shows that the MACD line (blue color) is currently above the MACD signal line (orange color). This is a possible bullish setup.
#5 Bullish RSI: The RSI is currently above 50 and moving higher, which is a possible bullish sign.
#6 Flag Pattern: As seen from the weekly chart, the stock was in a strong uptrend after which it started consolidating and was in a narrowing range. This is a classic flag pattern and is marked in the chart in pink color. A flag is a continuation pattern. Whenever a stock breaks out of this pattern, it typically continues its previous trend (uptrend in this case). Currently, the stock looks poised for a breakout from the flag pattern. This is a possible sign of an upcoming bullish move.
CRWD – Weekly Chart
#7 Bullish Stoch: In the weekly chart, the %K line of the stochastic is above the %D line, and is also moving higher from oversold levels, indicating possible bullishness.
Recommended Trade (Based on the Charts)
Buy Price: If you want to get in on this trade, the ideal buy level for CRWD is above the price of $200. However, those with a higher risk appetite can purchase half the intended quantity of shares of CRWD above $196.
TP: Our target prices are $213 and $223 in the next 3 to 5 months based on the falling wedge pattern breakout.
SL: To limit risk, place a stop loss below $193. Note that this stop loss is on a closing basis.
Our target potential upside is almost 7% to 12% in the next 3-5 months.
For a risk of $7.00, our first target reward is $13.00 and the second target reward is $23.00. This is a nearly 1:2 and 1:3 risk-reward trade.
In other words, this trade offers nearly 2x to 3x more potential upside than downside.
Risks to Consider
The stock may reverse its overall trend if it breaks down with high volume from the falling wedge pattern breakout level. The sell-off of the stock could also be triggered in case of any negative news, overall weakness in the market, or any regulatory changes in the sector.
Happy Trading!
— Tara
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