WISH stock price bounces 6.50%: Is ContextLogic about to break higher?

Summary:

The WISH stock price may not be as exciting as it once was, but there are signs that ContextLogic could be setting up for a rally.

The WISH stock price may not be as exciting as it once was, but there are signs that ContextLogic could be setting up for a rally.

ContextLogic Inc (NASDAQ: WISH) started the week with a positive trading day, finishing Monday at $10.47, higher by $0.64 (+6.51%).

Considering the volatility in the first seven months of 2021, the WISH stock price has been fairly muted recently. Formerly a favourite of Reddit’s wallstreetbets investing forum, ContextLogic Inc experienced two notable spikes higher this year.

In January, shares in the online retailer surged 88% to a record $32.85. However, by the 7th of June, the stock was lower by 77% and changing hands at $7.52. Although, 48-hours later, WISH had doubled to $15.00.

Since then, the stock has been unable to advance past $15.80 and subsequently has spent the last month fluctuating around $10.00.

Although the stock may not be the talking point, it was previously, the price shows some encouraging signs of life.

ContextLogic price forecast

The daily chart shows the price is holding above a rising trend line support at $9.50. The line from June’s low has held on a closing basis for the last two months. Therefore, this should be viewed as a significant level of support.

Furthermore, the WISH stock price is attempting to hurdle the 50-day moving average at $10.68. However, despite several attempts over the last couple of weeks, it is yet to close above this threshold. On that basis, if ContexLogic closes above $10.68, it will add to the positive outlook.

Should that happen, the 100 DMA at $11.85 is the first target for the bulls. Following that, June’s 15.18 high comes next.

The bullish view stays intact as long as WISH remains above the rising trend at $9.55. A close below this level invalidates this thesis and suggests a return to $7.52 is possible.