Technical Signals Point to a Possible Breakout for DATADOG INC - CLASS A.

DATADOG INC - CLASS A (NASDAQ:DDOG) was identified as a Technical Breakout Setup Pattern by our stockscreener. Such a pattern occurs when we see a pause in a strong uptrend: after a strong rise the stock is consolidating a bit and at some point the trend may be continued. Whether this actually happens can not be predicted of course, but it may be a good idea to keep and eye on NASDAQ:DDOG.

Technical Analysis Observations

ChartMill assigns a Technical Rating to every stock. This score ranges from 0 to 10 and is updated daily. The score is determined by evaluating multiple technical indicators and properties.

We assign a technical rating of 9 out of 10 to DDOG. This is due to a consistent performance in both the short and longer term time frames. Also compared to the overall market, DDOG is showing a nice and steady performance.

• Both the short term and long term trends are positive. This is a very positive sign.
• DDOG is one of the better performing stocks in the Software industry, it outperforms 74% of 282 stocks in the same industry.
• DDOG is currently trading in the upper part of its 52 week range. The S&P500 Index however is currently trading near a new high, so DDOG is lagging the market slightly.
• In the last month DDOG has a been trading in the 118.37 - 131.84 range, which is quite wide. It is currently trading in the middle of this range where prices have been consolidating recently, this may present a good entry opportunity, but some resistance may be present above.
• When comparing the yearly performance of all stocks, we notice that DDOG is one of the better performing stocks in the market, outperforming 88% of all stocks. However, this overall performance is mostly based on the strong move around 10 months ago.

For an up to date full technical analysis you can check the technical report of DDOG

Why is NASDAQ:DDOG a setup?

Next to the Technical Rating, the Setup Rating of a stock determines to which extend the stock is consolidating. This score also ranges from 0 to 10 and is updated daily. The setup score evaluates various short term technical indicators. For NASDAQ:DDOG this score is currently 9:

Besides having an excellent technical rating, DDOG also presents a decent setup pattern. Prices have been consolidating lately. There is a resistance zone just above the current price starting at 131.46. Right above this resistance zone may be a good entry point. There is a support zone below the current price at 122.75, a Stop Loss order could be placed below this zone. Very recently a Pocket Pivot signal was observed. This is another positive sign.

How to trade NASDAQ:DDOG?

One strategy to consider is waiting for the actual breakout to occur, where the stock breaks out above the current consolidation zone. Traders can then enter a buy position, anticipating further upward momentum. As a risk management measure, it is advisable to set a stop loss order below the consolidation zone.

Please note that this article should not be construed as trading advice. The information provided is solely based on automated technical analysis and serves to highlight technical observations. It is important to conduct your own analysis and make trading decisions based on your own judgment and responsibility.

More breakout setups can be found in our Breakout screener.

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.