Technical Analysis – Twitter stock consolidates after advance pauses

Twitter’s stock experienced a sharp jump in the beginning of April when the potential acquisition from Elon Musk was announced. However, after this initial boost, the positive momentum has failed to strengthen further, and the price has been trading sideways.

The momentum indicators suggest that bullish forces have gained the upper hand. The stochastic oscillator is marching higher after posting a bullish crossover, while the RSI is flatlining above its 50-neutral threshold. Moreover, the price is trading above the Ichimoku cloud, endorsing a broader bullish picture.

Should buying interest intensify, the price might confront initial resistance at the 200-day simple moving average (SMA), currently at 49.80. Piercing through this region, the bulls could aim for the 2022 peak of 54.00 before attention shifts to the 58.00 barrier. Higher up, any further advances could then stall at the October peak of 68.00.

Alternatively, if positive bias fades and the price dives lower, the 44.00 hurdle could prove to be the first line of defence. Dipping beneath that region, the price could descend towards 40.70 or lower to challenge the 36.70 obstacle. A violation of the latter could pave the way for the 2022 low of 31.40.

Overall, Twitter’s stock has been rangebound in the last few sessions, while near-term risks are tilted to the upside. Nevertheless, in the case that the deal with Elon Musk is sealed, the agreed buyout price is 54.20 per share. Thus, the share price appears to have limited upside potential. 

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