21Vianet's Technical Outlook is Bright After Key Golden Cross

From a technical perspective, Vnet Group Inc. VNET is looking like an interesting pick, as it just reached a key level of support. VNET's 50-day simple moving average crossed above its 200-day simple moving average, which is known as a "golden cross" in the trading world.

Considered an important signifier for a bullish breakout, a golden cross is a technical chart pattern that's formed when a stock's short-term moving average breaks above a longer-term moving average; the most common crossover involves the 50-day and the 200-day, since bigger time periods tend to form stronger breakouts.

A successful golden cross event has three stages. It first begins when a stock's price on the decline bottoms out. Then, its shorter moving average crosses above its longer moving average, triggering a positive trend reversal. The third and final phase occurs when the stock maintains its upward momentum.

A golden cross is the opposite of a death cross, another technical event that indicates bearish price movement may be on the horizon.

VNET could be on the verge of a breakout after moving 25.3% higher over the last four weeks. Plus, the company is currently a #2 (Buy) on the Zacks Rank.

Looking at VNET's earnings expectations, investors will be even more convinced of the bullish uptrend. For the current quarter, there have been 1 changes higher compared to none lower over the past 60 days, and the Zacks Consensus Estimate has moved up as well.

Given this move in earnings estimates and the positive technical factor, investors may want to keep their eye on VNET for more gains in the near future.

To read this article on Zacks.com click here.