In this daily bar chart of TWLO, below, we can see an impressive rally the past 12 months. Last February TWLO was below $30 and now it is nearly at $120. Prices are above the rising 50-day moving average line and the bullish 200-day line. The daily On-Balance-Volume (OBV) line has been in an uptrend the past year to confirm the price gains. In the lower panel is the 12-day price momentum study. Momentum is showing lower peaks from November to February while prices show higher peaks - this is a bearish divergence. Momentum is a leading indicator and a bearish divergence divergence can foreshadow a downward correction at times.
In this weekly bar chart of TWLO, below, we do not have a full three years of price history but it wouldn't change the outlook. TWLO is trading above the rising 40-week moving average line. The weekly OBV line is pointed up and is in new high ground. The 12-week price momentum study in the lower panel does not show a bearish divergence but momentum has slowed in recent weeks.
In this Point and Figure chart of TWLO, below, we can see the recent new highs. We can see an upside price target of $139. And wee can see that a decline to $107.61 will weaken this chart.
Bottom line strategy: investors have been rewarded handsomely by staying long TWLO but a pattern of slowing price momentum since November has made me a nervous long. Traders and investors should consider raising sell stop protection or even booking partial profits.