11 Day of Short interest? Yes please. Here’s your trade on $KRNT. (December 27, 2019)

by DAN KRNT 
This is Scott with your Free Chart of the Day. I want to take a look at Kornit Digital ( NASDAQ: KRNT ). As you can see if I zoom out here Kornit Digital ( NASDAQ: KRNT ) has been in a well-defined uptrend since forever. The last couple of months here Kornit Digital ( NASDAQ: KRNT ) has just really kind of been going sideways but finding support at the 50-day moving average, that’s this red line here. Every time the stock drops below the 50-day moving average traders come in and bring the stock back up.

If I zoom in a little more here you can see Kornit Digital ( NASDAQ: KRNT ) is kind of tightening up. You can see these moving averages converging; the moving averages are coming together and they are doing that for the first time in a long time. The last time the moving averages came together like that we saw a nice pop to the upside. So if I draw some lines here, I bet if I draw a line from this top here, you can see this downward sloping trendline that the stock is respecting. Ever since it hit this high, rejected there, rejected there; but then ever since it hit this low it has been printing higher lows, so it has kind of getting into a little bit of a volatility triangle here.

What I am looking for on Kornit Digital ( NASDAQ: KRNT ) is a move to the upside on volume. Now, I will say this stock does have 11 days of short interest. If I bring in the volume here, show you the volume a little more, you can see the volume is dropping off, so there is some complacency coming into this stock. Typically if we see a stock going sideways and the volume dropping off, that kind of give you an indication that we could see a move in either direction, either to the upside or the downside.

What I think you could do here with Kornit Digital ( NASDAQ: KRNT ) is set an alert around $35.00. If we get a pop up to 35.00 that will take out this bar right here, which takes out that high volume and could force some shorts to cover pushing this stock to the upside. So set an alert on KRNT ( NASDAQ: KRNT ) at $35.00 and watch for that volume to confirm a move to the upside.

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