The stock price of Zillow Group (Z) is soaring higher today. Are we late to the station or can the rally extend further? Let's pay a visit to our favorite collection of charts and indicators.
In this daily bar chart of Z, below, we can see that the stock price took a number of body blows from June to November. Prices dove from around $65 down to the $30-$25 area with two downside price gaps along the way.
A bearish death cross of the 50-day moving average line and the 200-day moving average line can be seen in September. The daily On-Balance-Volume (OBV) line declines to a November low. Things show a turnaround from November. Prices retest the November low in December and do not make a lower low.
In January prices rally above the 50-day moving average line and by late January the slope of the line turns positive. Today's strong advance puts prices just a few dollars below the bottoming 200-day moving average line.
The daily OBV line is doing its part with a higher low in December and a subsequent rise.
The Moving Average Convergence Divergence (MACD) oscillator gave cover shorts signals in November and December and finally crossed above the zero line this month.
In this weekly bar chart of Z, below, we can see that prices broke a two year uptrend with the decline that began last year. Key support zones were broken and these areas are likely to reverse roles and act as resistance during an advance.
The 40-week moving average line still has a bearish slope and the weekly OBV hardly shows any improvement, unlike the daily OBV line.
The weekly MACD oscillator gave a cover shorts buy signal in January but it is a long way below the zero line.
In this Point and Figure chart of Z, below, we can see today's strong advance. A potential upside price target of $59 is being indicated.
Bottom line strategy: Z could extend higher in the short-run but I am only seeing a relatively small base (from November). So despite a worthy Point and Figure target I think Z will trade sideways a bit longer before it is ready for a sustained move higher. If I am underestimating the strength of this current rally the issue is that you should probably risk a close below $35 if you want to buy it here. I will pass for now.