Fastly, Inc. ( FSLY) was a soaring stock until it was not. The company provides real-time content delivery network services. The stock had soared from $15 to $135 but that was the story in 2020. Today is another story.
In this daily bar chart of FSLY, below, we can see that prices turned lower from February around $120. Prices were cut in half to $60 and then cut in half again. FSLY is trading below the declining 50-day moving average line as well as below the slower-to-react 200-day line which also has a negative slope.
The On-Balance-Volume (OBV) line has made lower highs since February and continues to tell us that sellers of FSLY have remained more aggressive than buyers. The 12-day price momentum study shows a long pattern of higher lows for a bullish divergence but is not translated into a meaningful or sustained price recovery.
In this weekly Japanese candlestick chart of FSLY, below, we find little to cheer about. Prices are in a downtrend and trade below the declining 40-week moving average line. The weekly trading volume has been declining, telling us that investors are not interested and that without a burst of volume we cannot even suggest that traders have "thrown in the towel".
The 12-week price momentum study has been slowing but this, as we know, is not a precise timing tool.
In this daily Point and Figure chart of FSLY, below, we can see that prices reached and exceeded a downside price target of $34.
In this weekly Point and Figure chart of FSLY, below, we can see a lower price target in the $9-$10 area.
Bottom line strategy: While FSLY may have a good fundamental story, the charts are offering us no reason for purchase. Continue to avoid the long side.
Get an email alert each time I write an article for Real Money. Click the "+Follow" next to my byline to this article.
I'm not the only one who likes the tech behemoth. Bill Ackman believes Alphabet will be a leader in AI for years to come.
Real Money's message boards are strictly for the open exchange of investment ideas among registered users. Any discussions or subjects off that topic or that do not promote this goal will be removed at the discretion of the site's moderators. Abusive, insensitive or threatening comments will not be tolerated and will be deleted. Thank you for your cooperation.
If you have questions, please contact us here.
Email
Email sent
Thank you, your email to has been sent successfully.