Nasdaq 100 component Citrix Systems, Inc. (CTXS) was started in a powerful March rally when Wall Street analysts realized that videoconferencing could replace business travel as the most common form of distance communication, even after the pandemic runs its course. Citrix stock posted impressive gains in May’s all-time high at $155.10, and relaxed in a trading range, which is now carved out a bullish “flag” on the flagpole” model prediction of much higher prices.
Rival Zoom Video Communications, Inc. (ZM) obtained most of the upward trend of press during the advance and has recorded the best second quarter upside. However, the Citrix software is much more mature, with greater adaptation in the business environment. Citrix stock is also less volatile, even if the two questions are similar in movement of the floats, and Citrix is not the prey of Zoom safety problems that have exposed user data to unwelcome eyes.
Analyst consensus is surprisingly mixed on Citrix, with six “Buy” and seven “Hold” and “Sell” rating. The stock is now trading just below the median $154 target price and about $ 50 below the Street high of $200 target. Investors have chosen to ignore Wall Street skittishness, the lifting of the accumulation of readings to all the vertices, even if the price did not post a new high for two months. This bodes well for significant gains in the coming months.
Citrix Systems Long-Term Chart (1995 – 2020)
The creation of the public company at a split adjusted $2.05 in December 1995, and entered immediately on an uptrend that topped out at $7.47 a year later. The stock then crashed, the display of an all-time low at $ 1.28 before you can recover 100% of these losses and resume its strong upward trend. The rally finally topped at $96.58 in March 2000, marking the highest for 18 years, before the decline of the markets, which has given an astonishing 96% in 2002 down to $3.71.
A two-legged recovery wave recovered about one-third of the decline in 2006 amounted to $35.93 and relaxed in a trading range, before a failed 2007 attempt to breakout. Citrix stock relatively well during the economic collapse of 2008, has dropped to a four-year low, setting the stage for strong price action in the new decade. These impulse buys dropped almost 30 points below the 2000 level in 2011, the establishment of a level of resistance, which took another five years to overcome.
2016 breakout completed the return trip in 2000 top to 2017, which gives a larger-scale breakout that stalled near $117 in the summer of 2018. A decline towards the end of the year tested a new medium with success, serving as the basis for a strong 2019 slight increase in the head in January 2020. The stock returned to that level in March after a 30-point fall and broke once more, the display of all time in May.
Citrix Systems Short-Term Chart (2018 – 2020)
The balance volume (OBV), the accumulation-distribution indicator to overcome to advance prices in 2018 and has begun a small distribution phase that ended at 18-month low in August 2019. Later the purchasing power has reached the resistance in November, which gives a March 2020 breakout which continues to register new highs, even if the rally stalled two months ago. This sets up a bullish divergence, predicting that prices will soon follow.
The trading range since the month of March does not correspond to the definition of a bullish pennant pattern. but these are strange times, and the hodge-podge of price bars should act according to the traditional mechanisms – that is to say, acting as the point midway between the two vertical rally of the pulses. If yes, the next wave has the potential to reach $190 to $200 price of the area, marking a high percentage of return of currently negotiated levels.
The Bottom Line
Citrix stock has worked off the overbought technical readings after a dramatic first quarter of the bypass and could see a strong growth in the third quarter.
Disclosure: The author held no positions in the aforementioned securities at the time of publication.