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Pinduoduo Inc. Sponsored ADR (PDD) Just Reclaimed the 20-Day Moving Average

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From a technical perspective, Pinduoduo Inc. Sponsored ADR (PDD - Free Report) is looking like an interesting pick, as it just reached a key level of support. PDD recently overtook the 20-day moving average, and this suggests a short-term bullish trend.

The 20-day simple moving average is a well-liked trading tool because it provides a look back at a stock's price over a 20-day period. Additionally, short-term traders find this SMA very beneficial, as it smooths out short-term price trends and shows more trend reversal signals than longer-term moving averages.

The 20-day moving average can show signals that are similar to other SMAs as well. If a stock's price is moving above the 20-day, the trend is considered positive. When the price falls below the moving average, it can signal a downward trend.

Moving Average Chart for PDD

PDD has rallied 6% over the past four weeks, and the company is a Zacks Rank #1 (Strong Buy) at the moment. This combination suggests PDD could be on the verge of another move higher.

Once investors consider PDD's positive earnings estimate revisions, the bullish case only solidifies. No earnings estimate has been lowered in the past two months, compared to 2 raised estimates, for the current fiscal year, and the consensus estimate has increased as well.

Investors should think about putting PDD on their watchlist given the ultra-important technical indicator and positive move in earnings estimate revisions.


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