In this daily bar chart from SNOW, below, we can see a dramatic drop from the zenith in November. Prices fell to a low at the end of May and along the way we can see an increase in volume in March and another at the end of May. Trading volume has increased since early January, but both of these increases in volume may be “throwing in the towel” selling where underwater buyers end up giving up and selling their positions to others with deeper pockets.
The slope of the 50-day moving average line is negative, as is the slope of the 200-day line. With the 200 day line crossing around $270, I would consider SNOW extended (oversold) from the 200 day line. The On-Balance-Volume (OBV) line shows weakness from November to June, but perhaps the pace of aggressive selling is slowing.
The 12-day price dynamics study shows higher lows from March to June, telling us that the pace of decline is slowing. This is a bullish divergence from the price action and may suggest a rally is ahead.
In this weekly Japanese candlestick chart from SNOW, below, we see a mixed picture. Prices are in a downtrend below the descending 40-week moving average line. A recent doji could be the start of a reversal from the bottom. Prices are less than half the level of the 40-week line, so they are extended (oversold).
The weekly OBV line is still down, but the Moving Average Convergence Divergence Oscillator (MACD) is narrowing, telling us that the strength of the downtrend is weakening.
In this daily dot-and-digit chart from SNOW, below, we have used a different method of displaying price action using the average true range. Here the software indicates that we have reached a downside price target in the $111 area. (I try not to torture the data to give me the answer I’m looking for.)
Background strategy: All things considered, SNOW’s charts are mixed, so a story could be designed to be bearish or bullish. For now, I’m still leaning towards the bullish side of the ledger. Traders who went long on or around June 9 (our last review) should continue to hold unless they have been stopped out. Traders without a position could probe the long side by risking up to $105.
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