Watch These MongoDB Price Levels as Stock Pops After Database Software Provider Lifts Outlook
Key Takeaways
- MongoDB lifted its full-year outlook and boosted its stock buyback program, sending shares higher in premarket trading Thursday.
- The stock has carved out an inverse head and shoulders-like pattern between March and June, paving the way for a bullish upside reversal.
- Investors should watch crucial overhead areas on MongoDB's chart around $253, $298, and $355, while also monitoring a vital support level near $212.
MongoDB (MDB) lifted its full-year outlook and boosted its stock buyback program, sending shares of the AI-powered software provider up over 16% in premarket trading on Thursday.
The company said its flagship Atlas multi-cloud database subscription offering, which accounts for the lion’s share of net sales, recorded revenue growth of 26% in its latest quarter, adding that the firm also registered the highest total net customer additions in six years as enterprises and startups seek to modernize existing software and build new AI applications.
Heading into MongoDB’s earnings, the stock was 14% lower over the past 12 months but had recovered 42% from their early April low amid a strong rebound in AI software stocks driven by trade deal optimism.
Below, we break down the technicals on MongoDB’s chart and identify post-earnings price levels worth watching out for.
Inverse Head and Shoulders Bottom
MongoDB shares have carved out an inverse head and shoulders-like pattern between March and June, paving the way for a bullish upside reversal.
More recently, the pattern’s right shoulder found support just above the 50-day moving average (MA), with the relative strength index (RSI) confirming strengthening price momentum. That momentum could accelerate in Thursday's trading session following the company’s better-than-expected quarterly results.
Let’s identify three crucial overhead areas on MongoDB’s chart that could come into focus amid an earnings-driven rally and also point out a vital support level worth monitoring during future retracements.
Crucial Overhead Areas to Watch
Investors should initially watch the $253 area. The shares may encounter overhead resistance in this location near a trendline connecting a range of corresponding trading activity on the chart that preceded the notable early March stock gap. This area also closely aligns with the 50% Fibonacci retracement level when applying a grid from the stock's December high to April low.
A close above this crucial area could see the shares climb toward $298. This location on the chart may provide selling pressure near several peaks that developed on the chart between September and February.
Buying above this area could propel a move to around $355. Investors who have accumulated shares at lower price may seek exit points in this region near twin peaks that formed just above the 200-day MA in November and December last year.
Vital Support Level Worth Monitoring
Future retracements in MongoDB shares could see the price revisit lower support at the $212 level. This area would likely attract buying interest near a horizontal line linking the daily high of the March 6 gap with prominent troughs that emerged on the chart in June and August last year.
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