Bull Signal Says PYPL Could Move Closer to Record Highs

The security sports attractively priced premiums right now

Digital Content Manager
Mar 17, 2021 at 2:58 PM
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The shares of PayPal Holdings Inc (NASDAQ PYPL) are higher this afternoon, last seen up 0.6% at $250.89. The tech concern just recently hit a Feb.16 record high of $309.14, and remains up a remarkable 154.7% year-over-year. The even better news is that PYPL's recent tumble has placed it near a historically bullish trendline, which could help the security bounce back closer to its all-time high over the next couple of weeks. 

More specifically, PayPal stock just came within one standard deviation of its 80-day moving average, after spending months above this trendline. According to data from Schaeffer's Senior Quantitative Analyst Rocky White, at least five similar signals have occurred in the past three years. The equity enjoyed a positive return one month later in 75% of those cases, averaging a 4% gain for that period. From its current perch, a move of similar magnitude would put PYPL over the $260 mark, which is closer to its February peak.

PYPL 80 Day

Now could be a good time to weigh in on PayPal stock's next move with options. The equity's Schaeffer's Volatility Index (SVI) of 41% sits higher than only 17% of all other readings from the past year. In other words, options players are pricing in lower-than-usual volatility expectations right now.

Lastly, the security's Schaeffer's Volatility Scorecard (SVS) sits at an elevated 86 out of 100. This indicates the security has exceeded volatility expectations during the past year.

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