- WISH stock is a new retail favourite and popped back up on Monday.
- The stock had languished last week, but Monday sees an 18% rally.
- WISH stock still short of early June frenzy.
I wish I had seen this one coming, but the stock did help those traders wishing for higher prices on Monday. An 18% gain is not to be wished away (Ok, stop it now, please). The impressive performance, however, was possibly helped by Bitcoin woes as the meme stock space saw some interest and investment transfer across.
WISH is an online shopping platform that aims to allow merchants to show their goods to customers based on customers' interests and preferences. Essentially, users are allowed to discover products and shop accordingly.
Context Logic (WISH) key statistics
| Market Cap | $8.4 billion |
| Enterprise Value | $8 billion |
| Price/Earnings (P/E) | -3.3 |
|
Price/Book |
6 |
| Price/Sales | 2.6 |
| Gross Margin | |
| Net Margin | |
| EBITDA | -$600 million |
| Average analyst rating and price target | Buy $18.44 |
WISH stock forecast
The large price surge in WISH stock back on June 9 quickly gave up a lot of its gains but interestingly held the 9 and 21-day moving averages. These moving averages are talked off a lot and they do show the underlying short-term trend, so holding them indicated that WISH was not yet ready to turn negative. What followed was a consolidation phase before the shares took off again on Monday. The first resistance is the June 9 high at $15, closely followed by the previous $15.45 high from late April. Breaking the latter $15.45 resistance brings WISH shares into a very thin volume area meaning resistance is not too strong and the shares could move to $20.11. Breaking $15.45 also ends the series of lower highs since February.
The risk-reward is relatively neutral though as the momentum oscillators are close to overbought territory. The Relative Strength Index (RSI) and the Commodity Channel Index (CCI) are not yet in overbought regions but are very close. Buying a $16 call option would enable traders to reap profits if WISH shares break the $15.45 level and accelerate. Volatility in WISH has spiked given it is a meme name and due to the 18% move on Monday, which means that buying call options is now expensive. A call spread buying a near strike and selling a higher one reduces the cost of buying calls but does limit profit potential.
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