Zscaler (ZS) gapped higher Friday in reaction to a better than expected Q4 report and guidance. Let's check out the charts of this cybersecurity firm.
In this daily bar chart of ZS, below, we can see that prices opened sharply higher Friday. ZS gapped above the flat 50-day moving average line. The slope of the 200-day moving average line is negative and intersects up around $212 or so. The On-Balance-Volume (OBV) line shows a rise from May telling us that buyers of ZS have been more aggressive for a while now.
Friday's gap may not be a short-term event. The Moving Average Convergence Divergence (MACD) oscillator has been moving around the zero line but should turn bullish again if today's rally continues.
In this weekly Japanese candlestick chart of ZS, below, we see a picture that is just starting to improve. Prices are below the declining 40-week moving average line. The weekly OBV line has been only steady the past couple of months. The weekly MACD oscillator gave a cover shorts buy signal in July but remains below the zero line and an outright buy signal.
In this daily Point and Figure chart of ZS, below, we can see today's sharp rally - no gaps appear on this kind of chart. A $265 price target is being projected.
In this weekly Point and Figure chart of ZS, below, we see a $281 target.
Bottom line strategy: Traders could probe the long side of ZS below $180. Risk to $160 for now. The $265 area is our potential price objective.
