Uber Stock Cools Off Following Sale of Self-Driving Unit

The stock stands in "overbought" territory

Deputy Editor
Dec 8, 2020 at 10:02 AM
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Ride share giant Uber Technologies Inc (NYSE:UBER) is down 2.4% at $52.50 in this morning's trading, after the company announced its self-driving unit Advanced Technologies Group (ATG), will be acquired by startup competitor Aurora. With the acquisition set to close in the first quarter of 2021, ATG was given a $10 billion valuation. Meanwhile, Uber will invest $400 million into the startup, and Dara Khosrowshahi, Uber's CEO, will join the company's board. 

As previously mentioned, UBER is catching its breath today, and you need look no further than the equity's 14-day Relative Strength Index (RSI) of 71 to find out why. Uber stock's RIS stands firmly in "overbought" territory, which indicates a short-term breather may have already been in the cards.

Despite the pandemic, UBER has had a fantastic year on the charts. In fact, just yesterday, the equity rose to an all-time high of $54.87, and now boasts a more than respectable, 80.9% lead for 2020. A November bull gap saw the stock propel above the $39 level for the first time ever, and its 20-day moving average guided the stock on its journey higher, even capturing a small dip towards the end of the month.

Lastly, now could be the ideal time to take advantage of the security's next move with options. The stock's Schaeffer's Volatility Index (SVI) of 51% sits in the low 10th percentile of its annual range. This means UBER currently sports attractively priced premiums.

 

 

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