Arkk Innovation ETF. (NYSE:ARKK) has been trading lower throughout the month as selling pressure grew on innovation stocks, but today looks to be making a bounce back.
The ETF looks to have found an area of support and could be headed back higher toward resistance in a pattern it has been forming in for the past few months.
Arkk Innovation ETF was up 1.5% at $107.55 at press time.
Arkk Innovation ETF Daily Chart Analysis
- The ETF has been bouncing between narrowing highs and lows in what technical traders call a pennant pattern.
- As it nears the end of the pattern, the price has been getting squeezed between the highs and lows and could see a strong push past the resistance or support in time. A strong push in the same direction is possible if price is able to cross one of these levels.
- The ETF trades below both the 50-day moving average (green) and the 200-day moving average (blue), indicating recent sentiment looks to be bearish.
- Each of these moving averages may hold as a possible area of resistance in the future.
- The Relative Strength Index (RSI) has been falling lower and now sits at 30. This is on the border of the oversold region and shows the ETF has seen much more selling pressure compared to the amount of buying pressure.
What’s Next For Arkk Innovation ETF?
Bullish traders are looking to see a bounce off support and for the price to start trading with higher lows. Higher lows will show an uptrend is forming, and price could push higher toward resistance. Bulls would like to see a break above resistance and a strong bullish push above it.
Bears are hoping this bounce off support is fake and the ETF will continue to downtrend. If the price can break below the support level and hold it as an area of resistance it may see a strong bullish push in the future.
Source : https://www.benzinga.com/trading-ideas/long-ideas/21/11/24278078/arkk-innovation-etf-looks-to-be-bouncing-off-support-a-technical-analysis412