3 Reddit Stocks In Meltdown Mode: Is A Rally On The Horizon?

Stocks are always doing one of three things: Moving higher, moving lower or staying the same.

When they're moving higher the bulls (buyers) control the market. If a stock is moving lower, the bears (sellers) are in charge. If prices aren’t moving, the bulls and bears have equal power.

The break of a correctly drawn trendline is the first sign that the leadership is changing and the trend is about to reverse. Investors need to watch the downtrend lines on the charts of Sundial Growers Inc. SNDL, Square Inc. SQ and Zomedica Corp. ZOM.

If these stocks break the red downtrend lines on the following charts, meaning if the stocks rebound and trade above the lines, it could be the first sign that the bulls are taking back control. This could mean they're about to rally.

See Also: 3 ETFs That Say The Market Could Be Going Lower

Sundial has been trending lower since the middle of March. It's also below the psychologically important $1 level. If the stock breaks the red trendline and does rebound, there’s a good chance there are a lot of sellers, or resistance, at the level.

The bears took control of Square on April 29 and it has trended lower since then. If it reaches the $205 level, there is a good chance it finds support. If the stock rebounds and breaks the trendline, shares may be setting up for a rally.

Zomedica trended lower from early March through mid-April. The break of the red downtrend line was the first sign the bulls took control back. Shares rallied in the last week of April.
Then the break of the blue uptrend line was the first sign that the bears were taking charge and shares have trended lower since then. If they break the red downtrend line, it could mean they're about to rally.