The Wish stock price surged on Tuesday as interest in the company surged in social media networks like StockTwits and Reddit. The shares rose by more than 50%, valuing the e-commerce company at more than $6.8 billion. The shares are still down by more than 60% from their all-time high of $32.63.
What happened: Meme stocks have been making headlines recently. This has seen stocks like Blackberry, AMC, and GameStop move from obscurity to become some of the most highly traded companies in Wall Street.
On Tuesday, Wish moved into the spotlight as the shares jumped by more than 50% in a session. For starters, Wish, owned by ContenxtLogic, is an American company that offers e-commerce solutions. Wish is best known for offerng relatively cheap products, mostly from Asian sellers. YouTube videos of influences buying cheap products from the platform attract millions of views every month.
Wish stock has struggled after the company went public. It has fallen by more than 60% from the highest level this year. The losses accelerated after the company published mixed quarterly results. Precisely, the company’s revenue rose by 75% from the fourth quarter, helped by a 40% growth of its core marketplace Its logistics revenue also rose by 338% YoY to $245 million.. The company also managed to add more than 1,000 local partners in Brazil.
Therefore, analysts view Wish as a good candidate to become a meme stock. For one, it sells relatively cheap products, its short interest has risen, and its stock has continued to drop since going public.
Turning to the four-hour chart, we see that the Wish stock has recently bounced back. The shares have also managed to move above the 25-day and 50-day moving averages. Notably, the stock attempted to move above the upper side of the descending channel pattern that is shown in blue.
It is also slightly below the 23.6% retracement level. Therefore, with attention turning to the company, I can’t rule out a situation where it keeps rising as bulls target the 23.6% Fib at $13.28. The stop for this prediction will be the 25-day EMA at $8.30.
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