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Wex (WEX)'s Technical Outlook is Bright After Key Golden Cross
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After reaching an important support level, WEX Inc. (WEX - Free Report) could be a good stock pick from a technical perspective. WEX recently experienced a "golden cross" event, which saw its 50-day simple moving average breaking out above its 200-day simple moving average.
There's a reason traders love a golden cross -- it's a technical chart pattern that can indicate a bullish breakout is on the horizon. This kind of crossover is formed when a stock's short-term moving average breaks above a longer-term moving average. Typically, a golden cross involves the 50-day and the 200-day moving averages, since bigger time periods tend to form stronger breakouts.
There are three stages to a golden cross. First, there must be a downtrend in a stock's price that eventually bottoms out. Then, the stock's shorter moving average crosses over its longer moving average, triggering a positive trend reversal. The third stage is when a stock continues the upward momentum to higher prices.
A golden cross contrasts with a death cross, another widely-followed chart pattern that suggests bearish momentum could be on the horizon.
WEX could be on the verge of a breakout after moving 6.5% higher over the last four weeks. Plus, the company is currently a #1 (Strong Buy) on the Zacks Rank.
The bullish case only gets stronger once investors take into account WEX's positive earnings outlook for the current quarter. There have been 8 upward revisions compared to none lower over the past 60 days, and the Zacks Consensus Estimate has moved up as well.
Investors should think about putting WEXon their watchlist given the ultra-important technical indicator and positive move in earnings estimates.
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Wex (WEX)'s Technical Outlook is Bright After Key Golden Cross
After reaching an important support level, WEX Inc. (WEX - Free Report) could be a good stock pick from a technical perspective. WEX recently experienced a "golden cross" event, which saw its 50-day simple moving average breaking out above its 200-day simple moving average.
There's a reason traders love a golden cross -- it's a technical chart pattern that can indicate a bullish breakout is on the horizon. This kind of crossover is formed when a stock's short-term moving average breaks above a longer-term moving average. Typically, a golden cross involves the 50-day and the 200-day moving averages, since bigger time periods tend to form stronger breakouts.
There are three stages to a golden cross. First, there must be a downtrend in a stock's price that eventually bottoms out. Then, the stock's shorter moving average crosses over its longer moving average, triggering a positive trend reversal. The third stage is when a stock continues the upward momentum to higher prices.
A golden cross contrasts with a death cross, another widely-followed chart pattern that suggests bearish momentum could be on the horizon.
WEX could be on the verge of a breakout after moving 6.5% higher over the last four weeks. Plus, the company is currently a #1 (Strong Buy) on the Zacks Rank.
The bullish case only gets stronger once investors take into account WEX's positive earnings outlook for the current quarter. There have been 8 upward revisions compared to none lower over the past 60 days, and the Zacks Consensus Estimate has moved up as well.
Investors should think about putting WEXon their watchlist given the ultra-important technical indicator and positive move in earnings estimates.