Watching to see if Workday can get back on the job. ($WDAY) (August 05, 2020)
WDAY
This is Scott with your Free Chart of the Day. I want to take a look at Workday ( NASDAQ: WDAY ). I want to see if Workday ( NASDAQ: WDAY ) can get back to work. The stock has really just been resting here for the last couple of days. As you can see it bounced off of the 50-day moving average in May, it ran up quite nicely, consolidated; we are now back at the 50-day moving average.
The thing I like about the 50-day is, it is a key level that institutions use. And for us, as retail traders, we want to go where institutions are going. As you can see we had this kind of nice sideways drift into support and we’ve built a little bit of a flag pattern here. A little downwards sloping trendline holding right at some key moving averages. The stock is just around the 8-day moving average, the 50-day moving average and the 21-day exponential period moving average, so we are right there at support.
What I want to see from this stock is a move above this downward sloping trendline coming on volume; because that shows us that not only are institutions having to buy these dips, they are having to reach up higher to get the stock that they need. By doing that they should push the stock higher. I would set an alert on Workday ( NASDAQ: WDAY ) probably around 185.00, maybe 185.50, something like that. The reason we want to set it just around there is because as you can see that level has acted as resistance in the past. So we want to be able to take out that resistance and do it on volume.
I have an alert here at 185.50 and we will see if that triggers. If it does trigger then we are able to take a good low-risk entry because essentially you can put your stop just below today’s intraday low right around 180.00; you are only risking about 3 percent on that trade. And if it does break below today’s intraday low and close below today’s intraday low, well, then it’s not breaking out, it is doing something different than it’s done in the past; because in the past it has continually printed higher lows, so we like that.
Here on Workday ( NASDAQ: WDAY ) I have an alert at 185.50 and I think you should too.
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