Having touched a significant support level, Confluent (NASDAQ: CFLT) is a promising stock selection from a technical standpoint. CFLT has overcome resistance at its 20-day moving average, implying a possible upward trend in the short term.
The 20-day simple moving average is a widely utilized investment instrument. Traders favour this SMA as it offers a retrospective view of a stock’s price over a shorter duration, helping decrease price fluctuations. The 20-day SMA can also provide more trend reversal signals than longer-term moving averages.
The 20-day moving average can also deliver signals analogous to other SMAs. A stock’s price moving above the 20-day SMA indicates a positive trend. Conversely, if the price dips below the moving average, it might denote a downward trend.
In the last month, CFLT has risen by 12%. Presently, the company holds a Zacks Rank #3 (Hold), which further suggests that the stock could continue to ascend.
The argument for a bullish stance is further reinforced when considering CFLT’s encouraging earnings estimate revisions. The current fiscal year has seen nine upward revisions compared to none downward, leading to an upward movement in the consensus estimate.
Considering the upward shift in earnings estimate revisions and the encouraging technical indicator, investors should monitor CFLT closely for potential gains shortly.
The technical indicators and the earnings estimate revisions reflect favourably on Confluent (CFLT). It’s not just the upward momentum on the 20-day moving average that draws attention but also the positive changes in the company’s earnings forecast. By combining these two key factors, CFLT presents a potential opportunity for investors seeking near-term gains. It’s advisable, however, to keep a close eye on future developments and maintain a diversified portfolio to manage potential risks.
