Ulta Beauty (ULTA) Recently Broke Out Above the 20-Day Moving Average

Ulta Beauty (ULTA) is looking like an interesting pick from a technical perspective, as the company reached a key level of support. Recently, ULTA crossed above the 20-day moving average, suggesting a short-term bullish trend.

A well-liked tool among traders, the 20-day simple moving average offers a look back at a stock's price over a 20-day period. This is very beneficial to short-term traders, as it smooths out short-term price trends and gives more trend reversal signals than longer-term moving averages.

The 20-day moving average can show signals that are similar to other SMAs as well. If a stock's price is moving above the 20-day, the trend is considered positive. When the price falls below the moving average, it can signal a downward trend.

Shares of ULTA have been moving higher over the past four weeks, up 5.4%. Plus, the company is currently a Zacks Rank #3 (Hold) stock, suggesting that ULTA could be poised for a continued surge.

The bullish case only gets stronger once investors take into account ULTA's positive earnings estimate revisions. There have been 4 revisions higher for the current fiscal year compared to none lower, and the consensus estimate has moved up as well.

Investors may want to watch ULTA for more gains in the near future given the company's key technical level and positive earnings estimate revisions.

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

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