I can’t ‘say’ you should buy AFRM
Affirm Holdings (AFRM) is a financial lender of installment loans that consumers can use at the point of sale to finance a purchase. The action went public in January 2021 and we reviewed the action on November 16 where we wrote, “In our September 30 review, we recommended that“ The first increase stops at $ 105 from $ 69. Our price targets are $ 165 and then $ 189. “
Hope the traders took profit at $ 165 or more. Increase the stops on your remaining longs to $ 135 from $ 105. “Prices hit our stop level in the second half of November, so traders should have pulled out their remaining longs.
Let’s check AFRM again.
In this AFRM daily bar chart, below, we can see that prices continue to fall in January. AFRM is trading below the decreasing 50 day moving average line and below the 200 day limited line. The On-Balance-Volume (OBV) line shows weakness from October and tells me that the AFRM sellers have been more aggressive. The Moving Average Convergence Divergence Oscillator (MACD) is well below the zero line, but is approaching a hedge buy signal.
In this AFRM Japanese weekly candlestick chart, below, we can see a chain of red candles with a large red candle breaking below the 40 week moving average line. Trading volume declined, as did the weekly OBV line. The MACD oscillator is pointed towards the zero line.
In this AFRM daily points and numbers chart, below, we can see an upward price target of $ 108, but we also see resistance can be seen at $ 93 and above.
In this weekly AFRM points and numbers chart, below, we can see a bearish price target of just $ 9. Ouch.
Result strategy: AFRM could make an oversold bounce from $ 10 to $ 20, but the trend is down and a new base pattern has not formed. I try to find trends worth buying that don’t bounce into downtrends. I would pass on AFRM purchases at this point.
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