It's a New World and Zoom Video Is a Big Part of It

Now that the reality of social distancing is playing out across the country we are likely to see the share price of ZM move higher.

Zoom Video Communications Inc. (ZM) must be in a sweet spot right now. I want to relate a personal story before we look at the charts and indicators.

My wife and I belong to an active synagogue in western New Jersey. The board members have been on top of the rise in anti-semitic attacks across the country and last year got a grant to upgrade security at the building. More recently the board and the rabbi have been adjusting to the new health regulations in New Jersey. For example, last week the adult education class was a conference call and tomorrow's board meeting will happen with the help of Zoom. 

It's a new world that requires adaptability.  

Let's check out the charts of ZM even if you swear by fundamental analysis.

In the daily bar chart of ZM, below, we can see that prices do not go back a full 12 months. We do have enough price history for some plotting of the 200-day moving average line, which has a positive slope. The shorter 50-day moving average line crossed above the 200-day line earlier this month for a bullish golden cross.

The daily On-Balance-Volume (OBV) line shows a rise from December and the Moving Average Convergence Divergence (MACD) oscillator has been above the zero line from the beginning of 2020 but recently crossed to a take profits sell signal.  

 

In this daily Point and Figure chart of ZM, below, we can see that the software has decided that price activity has been indicative of accumulation (buying) and an upside price target of $148 is being projected. 

 

 

Bottom-line strategy: Now that the reality of social distancing is playing out across the country we are likely to see the share price of ZM move higher. Seasoned traders with available capital could trade ZM from the long side risking a close below $100.

 

Employees of TheStreet are prohibited from trading individual securities.