Shopify Inc - (SHOP.TO) - January 26, 2023
Shopify (SHOP.TO) has soared back up the rankings in the SIA S&P/TSX 60 Index Report this week, quickly returning to the Green Favored Zone from a dip down into the red zone. Yesterday, Shopify claimed top spot after moving up 5 positions capping off an incredible rise from 44th place last Friday.
Shopify (SHOP.TO) staged a major breakout yesterday. The shares have been base building since April, mostly trading between $40.00 and $60.00 as they stabilized following a major selloff in early 2022. SHOP.TO bottomed out near $35.00 in October and since then, it has established an upward trend of higher lows. This week accumulation has clearly accelerated with the shares staging a breakaway gap and then blasting through $60.00 to complete an Ascending Triangle base pattern and signals the start of a new uptrend with a spike in volume providing confirmation.
Based on measured moves, upside resistance tests could potentially emerge near $75.00, $80.00 or $85.00 on trend. Initial support moves up to the $60.00 breakout point from the bottom of the gap near $54.00.
It increasingly looks like Shopify (SHOP.TO) shares have turned the corner. After starting 2022 off with a major selloff, Shopify stabilized in the $39.00 to $54.00 range over the summer. The shares bottomed out in a final flush of weak hands back in October and since then, they have been under renewed accumulation. A December tax-loss selling related pullback bottomed out at a higher low, and since then, accumulation has accelerated with the shares rallying from near $45.00 back up above $60.00 for the first time since May. A recent bullish Double Top breakout has extended into a bullish High Pole.
Initial upside resistance may appear near $68.60 based on a vertical count, followed by $77.30 based on a horizontal count, and then $80.00 where a downtrend line, previous column low and a round number cluster. Initial support appears near $57.40 based on a 3-box reversal.
With its bullish SMAX score increasing to a perfect 10, SHOP.TO is exhibiting strength across the asset classes.
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