What's the Next Spot for Spotify Stock?
In my April 23 review of Spotify (SPOT) I wrote that "Today's price gains look like another 'gift horse.'" The company recently announced plans to raise prices for premium subscribers in the U.S. so let's check the charts again for this digital music, podcast, and video service.
In the daily bar chart of SPOT, below, I can see that prices have continued to make new highs. SPOT trades above the rising 50-day moving average line and above the rising 200-day line.
The trading volume has remained active. The On-Balance-Volume (OBV) line shows us a positive trend the past 12 months. The OBV line has leveled off the past two months. The Moving Average Convergence Divergence (MACD) oscillator is above the zero line but well off its best levels.
In this weekly Japanese candlestick chart of SPOT, below, I can see that prices are up over four-fold the past two years.
Trading volume has been active but does not show us expansion. The weekly OBV line shows a rise since early 2023 but it has not kept up with the price gains. The MACD oscillator is above the zero line but has weakened in recent weeks.
In this daily Point and Figure chart of SPOT, below, I can see a new high for the move up and a potential price target in the $388 area.
In this second Point and Figure chart of SPOT, below, I used weekly price data with a five-box reversal filter. Here the software gave us a price target in the $277 area.
Bottom-line strategy: It is a little disheartening to see the prices of a stock continue to rise after recommending taking profits. You have to call them as you see them. I would not recommend jumping back into shares of SPOT. Take a trading break and let's see what happens.
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