Workday (WDAY) reached a significant support level, and could be a good pick for investors from a technical perspective. Recently, WDAY broke through the 20-day moving average, which suggests a short-term bullish trend.
The 20-day simple moving average is a popular trading tool. It provides a look back at a stock's price over a 20-day period, and is beneficial to short-term traders since it smooths out price fluctuations and provides more trend reversal signals than longer-term moving averages.
Similar to other SMAs, if a stock's price moves above the 20-day, the trend is considered positive, while price falling below the moving average can signal a downward trend.
WDAY could be on the verge of another rally after moving 6.8% higher over the last four weeks. Plus, the company is currently a Zacks Rank #2 (Buy) stock.
Once investors consider WDAY's positive earnings estimate revisions, the bullish case only solidifies. No earnings estimate has been lowered in the past two months, compared to 11 raised estimates, for the current fiscal year, and the consensus estimate has increased as well.
With a winning combination of earnings estimate revisions and hitting a key technical level, investors should keep their eye on WDAY for more gains in the near future.
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