Watch These Robinhood Price Levels As Stock Jumps to 3-Year High

Shares Gained 10% on Tuesday

Key Takeaways

• Shares in Robinhood Markets could remain in focus on Wednesday after jumping 10% yesterday following the announcement of the online trading platform’s inaugural investor day and news of a price target boost from Barclays. 
• The shares broke out from a three-month symmetrical triangle Tuesday on the highest volume since early August, setting the stage for a continuation of the stock’s longer-term uptrend.
• Investors should monitor key retracement levels on Robinhood’s chart around $24, $20.50, and $16.50.
• The measuring principle, which calculates the distance between the symmetrical triangle’s two trendlines near the start of the pattern and adds that amount to the breakout point, forecasts an upside target in the stock of $33.50.

Shares in Robinhood Markets (HOOD) could remain in focus on Wednesday after jumping nearly 10% yesterday following the announcement of the online trading platform’s inaugural investor day and news of a price target boost from Barclays.

Analysts at the investment bank lifted their target on the stock to $23 from $20, saying that the company’s appealing offers and product range position it for sequential transaction revenue growth that exceeds expectations. They also expect CEO Vlad Tenev to unveil new products at the company’s “HOOD Summit” later this month.

Robinhood, which scheduled its investor day for Dec. 4 in New York City, has seen its shares more than double since the start of the year as retail traders open accounts with the brokerage in an effort to cash in on booming artificial intelligence (AI) stocks and volatile cryptocurrency prices.

The stock rose 9.8% to $25.61 on Tuesday and is trading at its highest levels since November 2021.

Below, we break down what the technicals are saying on Robinhood’s chart and identify important price levels worth watching.

Symmetrical Triangle Breakout

Robinhood shares broke out from a three-month symmetrical triangle Tuesday on the highest volume since early August, setting the stage for a continuation of the stock’s longer-term uptrend.

The relative strength index (RSI) confirms bullish price momentum, with a reading above the 70 threshold, but also indicates overbought conditions, which could lead to near-term retracements.

Let’s take a look at three crucial support levels on Robinhood’s chart likely to attract interest during periods of profit-taking and also forecast a chart-based price target.

Key Retracement Levels to Monitor

Firstly, investors should keep an eye on the initial breakout area around $24, an area on the chart that finds a confluence of support from recent peaks in the stock and the symmetrical triangle’s top trendline.

A breakdown below this level raises the possibility of a bull trap, which could see the shares reverse course to the $20.50 region. This area may encounter support near a trendline connecting a range of similar trading levels on the chart from March to September.

Further selling could trigger a steeper fall to $16.50, where bargain hunters may look for buying opportunities near a horizontal line that joins a series of lows on the chart from March to May with a number of comparable prices positioned above the August low.

Upside Price Target to Watch

We can predict a chart-based upside price target by using the measuring principle, also known as the measured move technique.

This works by calculating the distance between the symmetrical triangle’s two trendlines near the start of the pattern and adding that amount to the breakout point. 

For instance, we add $9.50 to $24, which forecasts a bullish target of $33.50, around 31% above the stock’s Tuesday closing price.

The comments, opinions, and analyses expressed on Investopedia are for informational purposes only. Read our warranty and liability disclaimer for more info.

As of the date this article was written, the author does not own any of the above securities.

Read the original article on Investopedia.