AppLovin Stock Rebound: Bullish Signal and Low Volatility Offer Attractive Investment Opportunity
AppLovin Corp (NASDAQ:APP) has experienced a significant decline since its early-June peak, falling 12.2% since the start of the month. However, the shares are on the rise today, up 2.9% to trade at $345.27 at last glance. This move is accompanied by a historically bullish signal, according to Schaeffer's Senior Quantitative Analyst Rocky White.
The recent pullback has pulled APP back to its 50-day moving average, with the stock now within 0.75 of the trendline'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. In the past three years, six other similar signals have occurred, with APP higher one month later 67% of the time, averaging an 8.3% gain.
A move of similar magnitude would have the shares making another run at $400, an area that has alternated between support and resistance in the last year. Since June, APP is 343% higher, though most of those gains have come from 2024, when the software name was the best-performing stock on the Nasdaq.
When considering the equity's next move, options look like a good way to go. AppLovin stock's Schaeffer's Volatility Index (SVI) of 60% ranks in the low 16th percentile of its annual range, meaning options traders are pricing in low volatility expectations. Additionally, APP has outperformed options traders' volatility expectations over the last 12 months, making this an excellent opportunity to weigh in with options. This is per its Schaeffer's Volatility Scorecard (SVS) of 81 out of 100.
In summary, AppLovin stock is currently trading near a historically bullish signal and with low volatility expectations, making it an attractive opportunity for investors looking to capitalize on potential gains in the coming month. The stock is currently trading at $345.27, and with a bullish signal and low volatility expectations, it could be a good time to invest in this promising company.
