Cloudtag: Hammer rebound at 50 day line

1 mins. to read
Cloudtag: Hammer rebound at 50 day line

Wearables group Cloudtag (LON:CTAG) has been one of the big stock market winners of the year to date. It has been helped along by being in the midst of the Zeitgeist of tech gadgets, as well as health and fitness concerns. Being a fan of a stock which has climbed far and fast over the near term can be a dangerous stance, especially if the cynics start to gain the upper hand. But so far Cloudtag appears to remain on the front foot.

The good news is that even though on the face of it we are looking at a classic jam tomorrow play, this company seems to be further down the road to significant revenues. It has been helped along by a fundraise this summer, and a US distribution deal with CITIES Market Studios Group. All of this goes to suggest that even though buying into this situation does not exactly feel clever or early bird in any way, the situation does appear to have been de-risked to at least a limited extent.

As far as the charting position is concerned it can be seen how we have been treated to a Hammer Candle bounce off the blue 50 day moving average now at 13.75p, also the floor of a rising trend channel from August. While cautious traders might wish to wait on an end of day close back above the 10 day moving average at 16p, while the latest support is held the notional upside here should be towards the top of the summer trend channel as high as 24p over the next 1-2 months.


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