Groupon (GRPN) Recently Broke Out Above the 20-Day Moving Average

From a technical perspective, Groupon (GRPN) is looking like an interesting pick, as it just reached a key level of support. GRPN recently overtook the 20-day moving average, and this suggests 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.

GRPN could be on the verge of another rally after moving 18.3% higher over the last four weeks. Plus, the company is currently a Zacks Rank #2 (Buy) stock.

The bullish case solidifies once investors consider GRPN's positive earnings estimate revisions. No estimate has gone lower in the past two months for the current fiscal year, compared to 3 higher, while the consensus estimate has increased too.

Given this move in earnings estimate revisions and the positive technical factor, investors may want to keep their eye on GRPN 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