E-commerce company Block (SQ) boosted their guidance Friday morning but their Q2 gross payment volume disappointed some investors. Let's check out the condition of the charts and the position of the indicators.
In this daily bar chart of SQ, below, I can see that prices stalled in July and had already turned lower. Prices are close to a retest of the 50-day and 200-day moving average lines. The trading volume is featureless in my opinion.
The On-Balance-Volume (OBV) line has improved since May but lacks in upside action. The Moving Average Convergence Divergence (MACD) oscillator gave a take profit sell signal before the earnings report.
In this weekly Japanese candlestick chart of SQ, below, I can see that prices have been working on a base for the past 16 months or so. Prices are trying to stay above the 40-week moving average line. The weekly OBV line has been moving sideways for a little more than a year now. The MACD oscillator is slightly below the zero line so it is still away from an outright buy signal.
In this daily Point and Figure chart of SQ, below, I can see a potential downside price target in the $63 area.
In this weekly Point and Figure chart of SQ, below, I can see an upside price target in the $116 area. Interesting.
Bottom line strategy: SQ could correct further to the downside in the days ahead. So far, this weakness appears to be a widening of the base pattern.
