Silverman was excited about their acquisition of Depop, an online fashion marketplace that is very popular with younger consumers. He said fashion continues to be a huge growth area for Etsy. Likewise, Silverman touted the company's purchase of Elo7, a Brazilian marketplace. Silverman said many people forget about South America, but it, too, remains a huge, untapped market for online commerce.
Let's check on the charts. In our last review of ETSY on June 29, we wrote that "We did not go long ETSY in May or earlier this month, so we are a little late to the game. Traders could go long ETSY around $195 while risking to $170 for now. The $260 area is our price target."
In this updated daily bar chart of ETSY, below, we can see that while prices have weakened, they have not declined to our $170 stop, so we continue to operate from the long side. Prices just broke below the 50-day and 200-day moving average lines. The daily On-Balance-Volume (OBV) line went sideways in July and could be turning lower again. The Moving Average Convergence Divergence (MACD) oscillator is pointed down towards the zero line.
In this weekly Japanese candlestick chart of ETSY, below, we see that prices have been struggling. ETSY is back below the rising 40-week moving average line. The weekly OBV line shows weakness in July, which tells us that sellers of ETSY have been more aggressive. The MACD oscillator tried to turn bullish last month, but it looks like that move failed.
In this daily Point and Figure chart of ETSY, below, we can see a potential downside price target in the $144 area.
In this weekly Point and Figure chart of ETSY, below, we can see a downside price target in the $138 area.
Bottom line strategy: I am assuming that traders are still long ETSY with a $170 stop. Prices have broken the July low and could retest or even break the June lows. I would sit tight for now and wait to see how things unfold from here.