Shoals Technologies Group (SHLS) Just Overtook the 20-Day Moving Average

After reaching an important support level, Shoals Technologies Group (SHLS) could be a good stock pick from a technical perspective. SHLS surpassed resistance at the 20-day moving average, suggesting a short-term bullish trend.

The 20-day simple moving average is a well-liked trading tool because it provides a look back at a stock's price over a 20-day period. Additionally, short-term traders find this SMA very beneficial, as it smooths out short-term price trends and shows more trend reversal signals than longer-term moving averages.

Similar to other SMAs, if a stock's price moves above the 20-day, the trend is considered positive, while price falling below the moving average can signal a downward trend.

Over the past four weeks, SHLS has gained 23.5%. The company is currently ranked a Zacks Rank #2 (Buy), another strong indication the stock could move even higher.

Looking at SHLS's earnings estimate revisions, investors will be even more convinced of the bullish uptrend. There have been 2 revisions higher for the current fiscal year compared to none lower, and the consensus estimate has moved up as well.

With a winning combination of earnings estimate revisions and hitting a key technical level, investors should keep their eye on SHLS for more gains in the near future.

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This article originally published on Zacks Investment Research (zacks.com).

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