After Golden Cross, nCino (NCNO)'s Technical Outlook is Bright

nCino Inc. (NCNO) is looking like an interesting pick from a technical perspective, as the company reached a key level of support. Recently, NCNO's 50-day simple moving average crossed above its 200-day simple moving average, known as a "golden cross."

A golden cross is a technical chart pattern that can signify a potential bullish breakout. It's formed from a crossover involving a security's short-term moving average breaking above a longer-term moving average, with the most common moving averages being the 50-day and the 200-day, since bigger time periods tend to form stronger breakouts.

There are three stages to a golden cross. First, there must be a downtrend in a stock's price that eventually bottoms out. Then, the stock's shorter moving average crosses over its longer moving average, triggering a positive trend reversal. The third stage is when a stock continues the upward momentum to higher prices.

This kind of chart pattern is the opposite of a death cross, which is a technical event that suggests future bearish price movement.

NCNO could be on the verge of a breakout after moving 6.5% higher over the last four weeks. Plus, the company is currently a #3 (Hold) on the Zacks Rank.

Once investors consider NCNO's positive earnings outlook for the current quarter, the bullish case only solidifies. No earnings estimate has gone lower in the past two months compared to 5 revisions higher, and the Zacks Consensus Estimate has increased as well.

Given this move in earnings estimates and the positive technical factor, investors may want to keep their eye on NCNO for more gains in the near future.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

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

Zacks Investment Research