Interactive Investor

PayPal: How high can the shares go?

30th July 2020 11:16

Alistair Strang from Trends and Targets


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The online payment platform continues to accelerate. Our chartist looks for further upside potential.

PayPal (Nasdaq:PYPL)

Once regarded as "just" the online portal for eBay, PayPal (NASDAQ:PYPL) services now include cards and payment terminals, as well as business finance.
Its share price has accelerated upward fairly remorselessly over the years, the value quickly exceeding the level before the Covid-19 dip and now looks poised to boldly go higher again.

PayPal's second quarter earnings report was announced after Wall Street's close last night, with the company posting its best ever performance thanks to increased demand for digital payments technology during the lockdown. 
The immediate situation suggests movement continuing above $186 should hopefully attempt an initial $193 with secondary, if exceeded, a marginally more interesting $197.
The proximity of both targets worries us a little as this sort of calculation will often point to the presence of a glass ceiling for movements, suggesting some hesitation is imminent.

Crucially, should PayPal manage to exceed $197 in the days ahead, it enters uncharted territory as we simply cannot calculate any higher.

Should trouble make itself known, the share price needs to weaken below $164 as this threatens reversal to an initial $152, hopefully producing a level at which the price bounces.
In the event any weakness makes its way below $152, the price could easily continue its reversal toward $121 and hopefully a price level regarded as "bottom".

Source: Trends and Targets      Past performance is not a guide to future performance

Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.

Alistair Strang is a freelance contributor and not a direct employee of Interactive Investor. All correspondence is with Alistair Strang, who for these purposes is deemed a third-party supplier. Buying, selling and investing in shares is not without risk. Market and company movement will affect your performance and you may get back less than you invest. Neither Alistair Strang or Interactive Investor will be responsible for any losses that may be incurred as a result of following a trading idea. 

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