Applovin Stock Could Extend Today's Bounce

Applovin Corp (NASDAQ:APP) is enjoying broader market tailwinds, last seen up 4.9% at $521.05. The stock has had a volatile year, recently falling from an early-June multi-month peak, but a bullish signal now flashing could mean even more short-term gains. 

According to Schaeffer's Senior Quantitative Analyst Rocky White, APP is trading within 0.75 times the 50-day moving average's 20-day average true range (ATR), after spending at least 80% of the previous two weeks and 80% of the prior 42 trading sessions above that trendline.

This setup has appeared six times during the last decade, after which the stock was higher one month later 83% of the time, averaging an impressive 6.4% gain. A comparable rally from current levels would put Applovin stock at $554.39. 

Furthermore, the 12.83 million shares sold short account for 5.14% of KR's available float, and it would take short sellers roughly three days to buy back their bearish bets at the stock's average pace of trading.

Options are affordably priced at the moment, per Applovin stock's Schaeffer’s Volatility Index (SVI) of 67% that stands in the 22nd percentile of its annual range. The stock tends to outperform these volatility expectations, too, according to its Schaeffer's Volatility Scorecard (SVS), which comes in at 80 out of 100.