Sticking With This SoFi Price Target After Beatdown
As long as this trend holds, I am not nervous about the digital financial services firm.
You're reading 0 of 1 free page.
Register to read more or Unlock Pro — 50% Off Ends Soon
There's no way to sugar coat this. I reiterated a $40 target price on SoFi Technologies (SOFI) early on Thursday morning and then took off the rest of the day as the rehearsal for my son's wedding was that afternoon. I had to gather guests who were traveling in, and I had to host the post-rehearsal meal.
I didn't even know how sharply the markets and especially stocks like SOFI had sold off until I noticed the hate mail.
As if readers need to be reminded, SOFI gave up 11.9% on Thursday and even after rebounding off of the lows, another 2% on Friday. The stock gave up 15% from its apex on Wednesday to where it closed on Friday. Needless to say, the low of the week last week was still higher than the low of the week prior. The stock had gained 27.7% on Friday, November 7, into that Wednesday high.
I know. No mention in the hate mail of the 27% gain that immediately preceded the 15% fall. Such is life. This is a stressful game. It can make people, even with the highest of IQs, look for someone to blame when they feel frustrated. Well, this is why we, as we have always, preach taking some profits at each and every target price breached. We have never failed to mention this when increasing a target price.
I literally cannot do more for readers than that. If someone needs full-service financial advice, then that is what they should seek and that is what they should pay for. I merely write about my trades. If you had a bad day being in my trades, well, they're my trades. I wasn't singing songs of victory either. I disclose everything, and I make sure you understand when I write up an idea that I am not quite sure about. SOFI is my third-largest holding.
So, What Am I Doing?
Readers may remember that I reiterated my plan last Monday. This is what I had published:
On Thursday, I was too busy to defend myself. On Friday, more of the onus was on the bride's parents, so I was able to get on the computer.
The stock pierced its 50-day SMA and though contact was not broken, it did not retake that line during the regular session. Of course, I added on that because I literally told readers I would. Plans are not plans unless implemented. I don't know if the stock will hold here. That depends a great deal on the macro and what the Federal Reserve speakers scheduled to appear publicly this week say about interest rates.
It is indeed a negative that the stock hit firm resistance precisely at our pivot. As readers have been taught, pivots can act as accelerators or as resistance. This time, the attempt at the pivot did not go in my favor.
The stock needs to retake and hold the 50-day SMA in order to make another run at that pivot. A failure to do so greatly increases the probability of the stock moving toward its 200-day SMA. That's why this is our pre-set panic point. Even at that price, our three-figure percentage gains are safe.
As long as contact is maintained with the 50-day SMA, I am not close to being nervous. Should contact be lost, I will add more aggressively as the 200-day line is approached. We'll worry about losing that line when it moves into range, which it may not do.
At this time, though SOFI is at the precipice of experiencing real technical damage, the pivot and therefore the target have not changed. A loss of the 50-day line that stands would move the pivot down to that line and would drag the target down with it. Let's also see if a new pattern develops out of that cup with handle.
Remember, fear is but for the wicked. We are not wicked; therefore, we shall not fear.
At the time of publication, Guilfoyle was long SOFI.
