On Wednesday, after market, Splunk (SPLK) is anticipated to report second quarter LPS of $0.34 compared to an EPS of $0.30 last year on revenue of approximately $520.7 million vs. $516.6 million a year earlier. The company provides software for machine log analysis and its current analyst consensus rating is 31 buys, 7 holds and 2 sells, according to Bloomberg.
Technically speaking, on a daily chart, Splunk's stock price has been holding an uptrend that began in mid-March and has been using the 20-day simple moving average (SMA) as support. Almost 3 weeks ago price crossed under the 20-day SMA and 50-day SMA, a bearish signal. Looking back to mid-Febraury traders can observe that price began a new downtrend the last time it fell below the 50-day SMA. The RSI is currently holding just above 50 and has been trending downward since late-May, which could possibly be unconfirmed bearish divergence. Price appears to have found resistance at the 20-day SMA. Price will likely continue to trend lower and break below the 189.00 support level, confirming a new bearish structure in price action. From there price will presumably decline to 171.00. If price manages to hold above 189.00, price could pop back up to the all-time high of 217.00 and possibly reach for the first Fibonacci target of 251.00.
Source: GAIN Capital, TradingView
GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.