Rocket Companies May Have Just Bounced Off Support: What's Next?

Rocket Companies Inc (NYSE: RKT) shares are trading lower and look to be nearing an area of support. The company announced Monday it will buy the personal finance app Truebill for $1.275 billion in cash.

Rocket Companies was down 6.26% at $14.46 Monday after market close.

Related: Why Did Rocket Companies Buy Truebill For $1.3B? CEO Jay Farner Explains

Rocket Companies Daily Chart Analysis

• Shares are trading in what is known as a falling wedge pattern and dropped to the support level in the pattern Monday. Shares look to be bouncing off support and heading slightly higher since reaching the support level.
• The stock trades below both the 50-day moving average (green) and the 200-day moving average (blue). This indicates bearish sentiment and each of these moving averages may hold as an area of resistance in the future.
• The Relative Strength Index (RSI) saw a dip lower and sits at 28 on the indicator. This shows that the RSI is in the oversold region and that the stock is seeing many more sellers than it is buyers.

What’s Next For Rocket Companies?

Rocket Companies is trading in the falling wedge pattern and for the stock to possibly see a turnaround it will need to cross above pattern resistance with above average volume. Bulls are also looking for the price to cross above the moving averages.

Bearish traders want the stock to continue to trade within the pattern. Closer to the end of the pattern, bears want to see the price fall below the pattern support.

Photo by Emiliano Vittoriosi on Unsplash