Q2 STOCKS TO BUY

Historically Bullish Signal Could Help Etsy Stock Find its Footing

An unwinding of pessimism could create tailwinds for ETSY

Digital Content Manager
Dec 15, 2021 at 3:19 PM
facebook X logo linkedin


It's been a roller coaster of a year for Etsy Inc (NASDAQ:ETSY), with the equity running into multiple speed bumps in 2021 before skyrocketing to a record high of $307.75 in late November. The peak was short-lived, and in early December, ETSY once again succumbed to long-term pressure at its $250 region, which is also home to the stock's previous March peak. The stock's luck seems to be turning around, however, as this  recent pullback was deftly captured by familiar support at the 200-day moving average, which could have bullish implications, if past is precedent. 

According to data from Schaeffer's Senior Quantitative Analyst Rocky White, ETSY just came within one standard deviation of its 200-day moving average after a lengthy period above the trendline. White's data shows three similar instances occurring in the last three years. One month later, the equity was higher 67% of the time, averaging a 5.5% pop in that time period. A similar move would put the stock just above the $231 area. 

etsy dec 15

A short-term bounce could already be in the cards for Etsy stock. This is per its 14-day relative strength index (RSI) of 27, which sits firmly in "oversold" territory. What's more, a short squeeze could already be well underway, and a further unwinding of these bearish bets could help push the equity higher. Short interest has dropped 10.9% in the last two reporting periods, but the 9.35 million shares sold short make up 7.4% of the stock's available float, or nearly a week's worth of pent-up buying power. 

A shift in sentiment among options traders could also create tailwinds. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), Etsy stock sports a 10-day put/call volume ratio of 1.04, which stands higher than 90% of readings from the past year, implying long puts are more popular than usual. Short-term options traders have rarely been more put-biased, either. The security's Schaeffer's put/call open interest ratio (SOIR) of 1.28 sits in the 90th percentile of its 12-month range. 

 

 
 

“Buy This Stock Now!” - Expert Who Called 11x On TSLA

He called a rare 11x on Tesla…

But now, thanks to Elon & Trump’s new alliance…

He says there’s a new opportunity that could be 1,000x BIGGER than Tesla – and it could completely revolutionize a $23 Trillion market.

It’s trading for less than $5 per share right now…

But it won’t be under the radar for long.

Discover The 1,000x Bigger Elon Opportunity Here

GRAND SLAM COUNTDOWN

 
 

Featured Articles from Trusted Partners:

👀Learn How Dividends Create Passive Income for Life
Receive $200 Off Motley Fool Epic. The Motley Fool Epic $299 discounted offer is based on $499/year list price. Introductory promotion for new members only. Take control of your money and your portfolio with Motley Fool Epic.

💵New Income System Could Pay You $4,243 Monthly
You could collect an average of $4,243 per month starting as early as next week with a new payout system for income investors. New registrations are being accepted for investors who want to be in a position to start with their first payout next week.

🚀Easy 92% Crypto Dividends (No Coins Required)
COIN stock doesn't pay a dividend... But there's actually a new way to collect a massive dividend that's indirectly based on the stock and offers a terrific monthly income (currently yielding nearly 92% on a forward basis).

🤝Free Advisor Match with Wiseradvisor.com
Don't leave your retirement to chance! Get matched with a trusted financial expert for FREE and make the most of your tax refund. Get started now.

⚠️Dennis Quaid's #1 Warning for Americans
Here's the thing: life doesn't come with guarantees. The economy shifts, markets stumble, and years of hard work could slip through your fingers like sand. But it doesn't have to be that way for you. So request a free copy of this Gold & Silver Guide that will arrive right to your doorstep when you act now.

 

 
 

Follow us on X, Follow us on Twitter