Redfin shares have grown significantly this year, despite the bearish outlook of analysts. Stock is consolidating at a breakout point, indicating potential upward momentum. Redfin’s high short interest may also act as a catalyst to further price increases.
Key Points
1. Redfin has experienced a significant turnaround in its shares this year despite analyst’s bearish sentiment.
2. The stock has been consolidating around a breakout, indicating a potential upward movement. Moving averages, for example, indicate a change of trend.
3. Short-sellers could be forced to cover positions if the stock rises above the critical level.
Redfin shares (NASDAQ: RDFN), a real estate company, have seen impressive growth in the past year. The stock has risen 160% year-to date and 183% over the last half-year. The stock, despite analysts’ negative sentiment, is consolidating at a breakout point, indicating potential upward momentum. The high short interest could also act as a catalyst to further price increases.
Redfin is a residential real-estate brokerage firm in the United States of America and Canada. It offers an online marketplace where individuals can buy and sell houses. The company offers title and settlement, mortgage origination and sale services as well.
Redfin is a company that analysts are not very optimistic about. “Reduce” The market appears to have a very different view based on the 14 analyst ratings. The consensus target price of $6.76 indicates a 38% drop in the share price, but currently shares are trading near an important breakout level.
Redfin’s shares have traded mainly between $8 and 12 throughout the year. In the last two months, Redfin shares have consolidated at the higher end, signaling increased interest from buyers and the potential of a breakout. The key moving averages on medium- and long-term timelines have also started flattening and curling higher. This signals a change in direction and trend.
Investors will closely monitor a breakout over the critical level $12 as this could confirm that the stock is moving higher. If this happens, the next potential target and resistance level is $14.
A high short interest could be one factor contributing to the further increase in Redfin share price. As of May 31 2023, RDFN’s short interest was 17.22% (or 19 million shares), which is $186 million in dollar terms. If the stock rises above the critical price and remains there, short sellers may start to cover their position, causing a demand/supply imbalance that drives the stock even higher.
Redfin analysts are still bearish, but the market is optimistic, and shares have been consolidating at a level near to a breakout. The high short interest may fuel an upward trend if a breakout happens. Before making an investment decision, investors should take into account the divergent views and do additional fundamental research.
Investors or traders who are focused on the short-term action of prices will find this opportunity more attractive than those looking at medium- to long-term trends. If the breakout occurs above $12, the stock may experience strong momentum on the upside.
To make an informed investment decision, it is important to perform thorough research on Redfin.
Redfin shares have made a major turnaround in the past year, despite analyst’s bearishness. The stock’s near-breakout level indicates potential upward momentum. A high short interest might also act as an accelerant for price increases. Investors must carefully consider the opposing viewpoints and do additional research before making a decision on whether to invest in Redfin.
