Will PagerDuty Dial It Up Further After Solid Quarter?

PD rang in strong Q3 numbers and is moving on Wednesday, but investors still need to keep the line open for the charts to develop further.

Shares of PagerDuty (PD)  are rallying Wednesday after its third-quarter numbers were better than anticipated. Is this enough to launch a sustained advance?

Let's check.

We looked at PD back on June 3 and wrote that "Traders could initiate a small long position in PD ahead of earnings. Risk to $34. The $59 area is our price target."  

In this updated daily bar chart of PD, below, we can see that prices managed to rally briefly to $50, but then fizzled. Prices have been in a decline from early September and broke the March and May lows. PD is trading below the declining 50-day and 200-day moving average lines. The daily On-Balance-Volume (OBV) line is showing some weakness from early September. The trend-following Moving Average Convergence Divergence (MACD) oscillator is bearish but narrowing slightly. 

In this weekly Japanese candlestick chart of PD, below, we can see that prices are testing a potential support area in the $30-$25 area. The slope of the 40-week moving average line is bearish. The weekly OBV line has been weak the past three months. The MACD oscillator is below the zero-line. 

 

In this daily Point and Figure chart of PD, below, we can see that prices reached and exceeded a downside price target in the $38 area. 
In this weekly Point and Figure chart of PD, below, we can see that prices reached and exceeded a $31 price target. 

Bottom line strategy: PD may have made a low but further base building is needed. Let's keep an eye on this one. 

 

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