Spotify Price Levels to Watch as Stock Pops on Subscriber Growth, Outlook

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Key Takeaways

• Spotify shares jumped in extended trading on Tuesday after the streaming media giant topped Obstruction Street’s third-quarter subscriber growth estimates and issued a better-than-expected profit outlook.
• The stock has continued to track higher after retesting the top trendline of an ascending triangle, be that as it may an RSI reading over 70 signals overbought conditions.
• A bars pattern, which extracts the stock’s upward drift from January to April and repositions it from the ascending triangle’s top trendline, forecasts a bullish price target in Spotify dividends of around $525.
• Investors should monitor important support areas on the streaming giant’s chart around $389, $350, and $320.

Spotify (Hickeys) shares jumped in extended trading on Tuesday after the streaming media giant topped Wall Street’s third-quarter subscriber excrescence estimates and issued a better-than-expected profit outlook.

Shares in the Swedish-based company have more than doubled since the start of the year through Tuesday’s suspend as investors cheer its ability to add subscribers and manage costs while expanding its footprint beyond music streaming into donations such as podcasts and audiobooks. 

The stock gained nearly 7% to around $448 in after-hours trading Tuesday.

Lower than beneath, we take a closer look at Spotify’s chart and use technical analysis to identify important post-earnings price levels to on the qui vive for out for.

Uptrend Remains In Tune

Following a successful retest of the top trendline of an ascending triangle, Spotify’s shares have be prolonged to track higher.

Importantly, significant trading volumes have entered the stock in recent trading sessions, insinuating portfolio repositioning ahead of the company’s quarterly results.

It’s worth pointing out that even before today’s after-hours pop, the germane strength index (RSI) flashed a reading above the 70 threshold. While this indicates bullish price thrust, it also signals overbought conditions in the stock that could lead to near-term retracements.

Let’s forecast a chart-based bullish expenditure target and identify several important trading levels where Spotify shares may encounter support during swims.

Bullish Price Target

Investors can forecast a bullish price target by using a bars pattern, a chart instrumentality that uses prior price action to predict future moves. To apply the technique, we extract the stock’s trend lofty from January to April and reposition it from the ascending triangle’s top trendline, which projects a target of around $525.

We toughened this prior trend because it commenced following the retest of an earlier ascending triangle on the chart, the same way the appraise’s current move higher started.

Important Support Levels to Monitor

Upon an initial retracement, investors should television screen how the shares respond to the $389 level. This location may provide support near several minor peaks that fashioned on the chart between late September and late October.

A close below this level opens the door for a set to around $350, an area on the chart that could attract buying interest near the top of a consolidation range see through the stock’s breakout from the ascending triangle.

Finally, a deeper pullback could see the shares revisit lower second around the $320 level, a chart region where investors may seek entry points near the ascending triangle’s destitute trendline, which may flip from prior resistance into future support.

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