Lemonade Inc (NYSE:LMND) stock hit a Jan. 22 four-year high of $99.90, after news of its autonomous car insurance that will launch with Tesla (TSLA) FSD models. Though the stock has moved lower since then, the pullback could be short-lived given the layers of technical support, including the $70 level and ascending 100-day moving average.
According to Schaeffer's Senior Quantitative Analyst Rocky White, SHOP is within 0.75 of its 100-day moving average's 20-day average true range (ATR), after remaining above this level 80% of the time over the past two weeks and 80% of the last 42 trading sessions. This signal has occurred six other times in the past decade, after which LMND was higher one month later 67% of the time with an average gain of 14.2%. A similar move from the stock's current perch at $69.50 would put it at $79.36.
An unwinding of pessimism could give LMND a boost as well. Short interest represents a whopping 19.4% of the stock's available float, or nearly five days' worth of pent-up buying power. Plus, despite the stock's recent peak, 11 of the 14 analysts in coverage carry a "hold" or worse rating, leaving plenty of room for upgrades.
