Coupa Software ( COUP) is expected to report earnings after the close of trading Monday. It has been a while but let's check out the charts and indicators.
Our last review of COUP was a year ago on Dec. 7, 2020 where we recommended that, "COUP has not made any sustained upside progress the past five months. .... I would retreat to the sidelines for a few days."
Let's see how things have changed in the past year.
In the updated daily bar chart of COUP, below, we can see that the shares have weakened significantly the past 12 months. The shares have been trading below the declining 50-day and the weak 200-day moving average lines for some time now.
The daily On-Balance-Volume (OBV) line has been pointed down since last December and tells us that sellers of COUP have been more aggressive than buyers the past year. The 12-day price momentum study does not show that the pace of the decline has been slowing. A slower pace on a decline can come from scale-down buyers finding the stock more attractive at lower levels.
In the weekly Japanese candlestick chart of COUP, below, we find little to cheer about. Prices have been trading below the declining 40-week moving average line for some time now. We have to look back to 2019 to find an area that might act as support.
The weekly OBV line is pointed lower and the Moving Average Convergence Divergence (MACD) oscillator is bearish.
In this daily Point and Figure chart of COUP, below, we can see the sharp decline in prices. COUP has reached a downside price target but that is not enough to recommend purchase.
In this weekly Point and Figure chart of COUP, below, we can see a large top pattern and a potential downside price target in the $83 area.
Bottom-line strategy: I have no special knowledge of what COUP will report for earnings. After a long decline there is always a chance of a bounce or relief rally but I would not expect it, should it occur, to last long or travel far. A new base pattern needs to form before I can recommend purchase.
