Opera Limited Sponsored ADR (OPRA) is looking like an interesting pick from a technical perspective, as the company reached a key level of support. Recently, OPRA's 50-day simple moving average crossed above its 200-day simple moving average, known as a "golden cross."
There's a reason traders love a golden cross -- it's a technical chart pattern that can indicate a bullish breakout is on the horizon. This kind of crossover is formed when a stock's short-term moving average breaks above a longer-term moving average. Typically, a golden cross involves the 50-day and the 200-day moving averages, since bigger time periods tend to form stronger breakouts.
Golden crosses have three key stages that investors look out for. It starts with a downtrend in a stock's price that eventually bottoms out, followed by the stock's shorter moving average crossing over its longer moving average and triggering a trend reversal. The final stage is when a stock continues the upward climb to higher prices.
This kind of chart pattern is the opposite of a death cross, which is a technical event that suggests future bearish price movement.
Shares of OPRA have been moving higher over the past four weeks, up 25.8%. Plus, the company is currently a #3 (Hold) on the Zacks Rank, suggesting that OPRA could be poised for a breakout.
The bullish case solidifies once investors consider OPRA's positive earnings outlook. For the current quarter, no earnings estimate has been cut compared to 0 revisions higher in the past 60 days. The Zacks Consensus Estimate has increased too.
Investors may want to watch OPRA for more gains in the near future given the company's key technical level and positive earnings estimate revisions.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
