Sea Ltd (NYSE:SE), one of Schaeffer's top picks for 2025, has seen some volatility since its Sept. 11 three-year high of $199.30. The shares were last seen down 0.7% at $181.34 today, and earlier traded as low as $176.00 -- a level that appears to be emerging as a layer of support. It's likely that the stock will bounce off this region once again, as the recent pullback has it coming into contact with a historically bullish trendline.
Per Schaeffer's Senior Quantitative Analyst Rocky White, the stock is within 0.75 of the 50-day moving average's 20-day average true range (ATR), after spending at least 80% of the last 10 days and 80% of the last two months above it. This has happened three other times over the past three years, after which the equity was higher one month later 71% of the time, averaging a 3.5% gain. A move of similar magnitude would put the shares at $187.68.
Though short interest has been unwinding, it still represents 5.2% of the stock's available float. It would take shorts over five days to cover, at SE's average pace of trading -- plenty of pent-up buying power.
