EBAY has pulled back to its bullish 126-day moving average
E-commerce giant eBay Inc (NASDAQ:EBAY) has been trading choppily since its Feb. 26 three-year peak of $71.61, recently consolidating around the $65 level. The shares could soon push above that high, however, if history is any indicator.
Per Schaeffer's Senior Quantitative Analyst Rocky White, EBAY has recently pulled back to its 126-day moving average, which represents half a years worth of trading. Specifically, the stock is within 0.75 of the trendline's average true range's (ATR), or 20-day ATR, for the first time in at least eight of the past 10 trading days, after spending at least 75% of the last six months above it.
eBay stock has seen six similar signals over the past three years, after which it was higher one month later 86% of the time with an average 8.7% gain. From its current perch at $66.15, a similar move would put the security at $71.90 -- just above its February peak.
The majority of analysts are bearish on EBAY despite its 6.9% year-to-date lead and recent highs. Of the 30 analysts in coverage, 20 carry a "hold" or worse rating, leaving plenty of room for upgrades that could provide tailwinds.