KE Holdings Inc. Sponsored ADR Now Trades Above Golden Cross: Time to Buy?

After reaching an important support level, KE Holdings Inc. Sponsored ADR BEKE could be a good stock pick from a technical perspective. BEKE recently experienced a "golden cross" event, which saw its 50-day simple moving average breaking out above its 200-day simple moving average.

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.

Shares of BEKE have been moving higher over the past four weeks, up 37.4%. Plus, the company is currently a #1 (Strong Buy) on the Zacks Rank, suggesting that BEKE could be poised for a breakout.

The bullish case solidifies once investors consider BEKE's positive earnings outlook. For the current quarter, no earnings estimate has been cut compared to 2 revisions higher in the past 60 days. The Zacks Consensus Estimate has increased too.

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

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