Should You Buy Equinix (EQIX) After Golden Cross?
Equinix, Inc. (EQIX) is looking like an interesting pick from a technical perspective, as the company reached a key level of support. Recently, EQIX's 50-day simple moving average crossed above its 200-day simple moving average, known as a "golden cross."
Considered an important signifier for a bullish breakout, a golden cross is a technical chart pattern that's formed when a stock's short-term moving average breaks above a longer-term moving average; the most common crossover involves the 50-day and the 200-day, since bigger time periods tend to form stronger breakouts.
A successful golden cross event has three stages. It first begins when a stock's price on the decline bottoms out. Then, its shorter moving average crosses above its longer moving average, triggering a positive trend reversal. The third and final phase occurs when the stock maintains its upward momentum.
A golden cross is the opposite of a death cross, another technical event that indicates bearish price movement may be on the horizon.
EQIX has rallied 15.8% over the past four weeks, and the company is a #2 (Buy) on the Zacks Rank at the moment. This combination indicates EQIX could be poised for a breakout.
The bullish case only gets stronger once investors take into account EQIX's positive earnings outlook for the current quarter. There have been 5 upward revisions compared to none lower over the past 60 days, and the Zacks Consensus Estimate has moved up as well.
Given this move in earnings estimates and the positive technical factor, investors may want to keep their eye on EQIX for more gains in the near future.
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Equinix, Inc. (EQIX): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
Source Zacks-com
