AppLovin Soars on Strong Q4 Earnings and Outlook
Key Takeaways
* APP stock surged nearly 30% in after-hours trading on Wednesday.
* The AI-powered advertising platform exceeded analyst expectations for Q4 earnings.
* AppLovin provided a positive outlook for the current quarter.
* The stock is poised to break out from a pennant pattern, signaling a potential continuation of its uptrend.
* Measured move technique forecasts a price target of $754.
* Investors should monitor support levels at $290, $168, and $116.
Pennant Pattern Breakout
Since its all-time high in December, APP has consolidated within a pennant pattern, indicating a continuation of its uptrend. A breakout above the pattern's upper trendline is expected, setting the stage for further gains.
Measured Move Price Target
Applying the measured move technique, we add the height of the uptrend preceding the pennant ($357) to the pattern's upper trendline, resulting in a price target of $754. This area may present a profit-taking zone.
Major Support Levels
Potential retracements could encounter support at $290 (near the pennant's low), $168 (near the 50-period moving average), and $116 (near November 2021's swing high). These levels provide potential entry points for buy-and-hold investors.
Conclusion
AppLovin's strong Q4 performance and positive outlook have fueled its stock's surge. A breakout from the pennant pattern and favorable support levels suggest further upside potential. Investors should monitor the stock's price action and key resistance/support levels for trading opportunities.