The actions of Salesforce rose more than 5% on Thursday before the market opened, as investors applauded the company’s positive quarterly results and its push towards artificial intelligence to drive growth. This is key for holders of Cedears of that firm, which is listed on the local market under the ticker $CRM.
The company has been investing significantly in integrating its AI technologies into existing products, such as its messaging platform Slack, to improve its capabilities and attract more customers. With operations up and running, they moderated the rise to 2%.
Salesforce shares rose in premarket trading after it reported better-than-expected second-quarter earnings and raised its annual earnings forecast as customers increased spending on its cloud product suite.
The San Francisco-based company, which also announced late Thursday that Chief Financial Officer Amy Weaver is stepping down, has seen its shares come under pressure this year due to a slowdown in sales driven by tighter corporate budgets and increasing competition in the cloud artificial intelligence (AI) software space.
Breakout of the symmetrical triangle pattern
Salesforce stock has been trading in a symmetrical triangle since mid-May, with a notable gap in the stock of around 20% occurring at the beginning of the pattern. More recently, the price has been consolidating just below the triangle’s upper trendline and 200-day moving average ahead of the company’s quarterly report.
Thursday’s projected earnings surge positions the stock for a decisive break above this closely watched chart area, potentially marking the start of a new uptrend.
The first level to watch is around $287, a location on the chart that could face selling pressure near a trendline that links the April 15 gap high to a week-long consolidation period that formed in mid- to late May.
Buying above this level could see the stock price move towards the $311 area, where sellers could attempt to offload shares around a range of comparable trading levels during March and early April, situated just below the stock’s all-time high.
To forecast a price target above the all-time high (ATH), we can use the measurement principle. To do this, we calculate the distance of the triangle in points and add that amount to the upper trendline of the pattern. In this case, we add $75 (distance between the two trendlines of the triangle) and $265 (the upper trendline of the pattern), which projects an upside target of $340.
Source: Ambito
