Pinterest Inc. (NYSE:PINS) is on the verge of forming a Golden Cross -- a bullish technical signal that occurs when the 50-day simple moving average (SMA) rises above the 200-day SMA.
While the stock has been in a downtrend, falling nearly 19% in the past month, buying pressure is beginning to emerge. This shift in momentum suggests Pinterest stock could be setting up for a bullish breakout.
Chart created using Benzinga Pro
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Pinterest Stock's Golden Cross Could Signal A Bullish Turn
Despite recent weakness, key technical signals point toward a potential turnaround:
- Golden Cross Formation: The 50-day SMA is on track to cross above the 200-day SMA, a historically bullish pattern.
- Buying Pressure Emerging: While Pinterest's stock is still trading below its eight-day, 20-day, and 50-day SMAs, growing demand could push prices higher.
- Moving Average Convergence Divergence (MACD): Currently at a negative 0.89, the MACD remains in bearish territory but is trending higher, suggesting a shift in momentum.
- Relative Strength Index (RSI): At 39.99, RSI is approaching neutral territory, indicating that selling pressure is fading.
With these technicals improving, Pinterest may be gearing up for a bullish breakout.
Investor Implications: A Bullish Setup In The Making?
A golden cross is often seen as a strong bullish indicator, suggesting the potential for a sustained rally. While Pinterest's recent weakness has weighed on sentiment, increasing buying pressure could signal a shift in trend.
Investors watching for confirmation may wait for the golden cross to officially form, but the improving technical backdrop suggests Pinterest's stock could be on the verge of a rebound.
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