The benefits management company that specializes in fertility and family building benefits solutions for employers in the United States, Progyny Inc. (NASDAQ: PGNY) seems to be gearing up for a price surge according to its latest charts.
Bullish Indications
#1 Symmetrical Triangle Pattern Breakout: The daily chart shows that the stock had formed a symmetrical triangle pattern. This is marked in purple color lines. This pattern is usually formed when there is an indecision in the price movements and uncertainty among the buyers and sellers. It represents a period of consolidation before the price breaks out or breaks down. Currently, the stock has broken out of the symmetrical triangle pattern. This usually signifies the start of a new bullish trend.
Daily Chart – PGNY
#2 Bullish Stoch: The %K line of the stochastic is currently above the %D line, indicating bullishness.
#3 Above MA: The stock is currently trading above its 50-day SMA, indicating that the bulls are currently in control.
#5 Falling Wedge Pattern Breakout: As you can see from the daily chart, the stock was forming a falling wedge pattern for the past several months.
This is marked as pink color dotted lines.
The stock had typically taken support at the bottom of the wedge before bouncing back. The stock has currently broken out and is moving higher, which is a possible bullish sign.
#6 Near Support Area: The weekly chart shows that the stock has currently moved up from a support area. This area is marked as a purple color dotted line. This seems like a good area for the stock to move higher.
Weekly Chart – PGNY
#7 Downtrend Broken: The weekly chart shows that the stock has currently broken out of a short-term downtrend. This downtrend line is marked in orange color. This is a possible bullish indication.
#8 Bullish Stoch: The %K line of the stochastic is currently above the %D line in the weekly chart as well, indicating possible bullishness.
Recommended Trade (based on the charts)
Buy Price: If you want to get in on this trade, the ideal buy level for PGNY is above yesterday’s close. This translates to a price of around $26.90.
TP: Our first target price is $30 and the second target price is $35 in the next 4-6 months.
SL: To limit risk, place a stop loss at $24.80. Note that this stop loss is on a closing basis.
Our target potential upside is almost 12% to 30% in the next 4-6 months.
For a risk of $2.10, our first target reward is $3.10 and the second target reward is $8.10. This is a 1:2 and 1:4 risk-rewards trade.
In other words, this trade offers nearly 2x to 4x more potential upside than downside.
Risks to Consider
The stock may reverse its overall trend if it breaks down with high volume from the symmetrical triangle pattern. The sell-off of the stock could also be triggered in case of any negative news, overall weakness in the market, or any regulatory changes in the sector.
Happy Trading!
— Tara
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