Brown said the freelance trend started well before the pandemic began, but it really exploded last year. There are now over 53 million people freelancing in the U.S.
The professionals on Upwork are college-educated, highly skilled individuals earning high wages and building their own independent businesses, Brown said.
Let's check out the charts now that we have the fundamental story.
In the daily Japanese candlestick chart of UPWK, below, we can see that the shares are up around six-fold from their lows of early 2020. Prices made an upper shadow Wednesday above $60 showing that traders rejected those gains. UPWK is trading above the rising 50-day moving average line. There have been some pullbacks toward the line in early January and just the other day.
The On-Balance-Volume (OBV) line shows a bullish rise over the past 12 months telling us that buyers of UPWK have been more aggressive. This confirms and supports the price gains. The Moving Average Convergence Divergence (MACD) oscillator made a slight new high this month but just crossed to the downside for a take profit sell signal.
In the weekly Japanese candlestick chart of UPWK, below, we can see a mixed picture. Prices are in an uptrend above the rising 40-week moving average line. The 40-week line intersects around $26 so with the shares trading at twice the 40-week line they can be considered extended or overbought. A move closer to the 40-week line would be good.
The OBV line shows a rise from March but so far this month the line is pointing down suggesting that sellers are becoming more aggressive. The MACD oscillator is bullish but just now starting to narrow telling us that the strength of the uptrend has wavered.
In this daily Point and Figure chart of UPWK, below, we can see a potential price target of $102 but the recent wide range on the chart suggests we will see some sideways price action before renewed gains.
Bottom-line strategy: UPWK is a new name for me. I should be more familiar with the company as I know many freelancers. The shares have made a good run since early April. A period of sideways price movement a.k.a. consolidation would improve the technical picture. With a $102 price target from the Point and Figure chart I want to be a buyer when a low risk opportunity develops.