Chewy Just Overtook the 20-Day Moving Average

From a technical perspective, Chewy CHWY is looking like an interesting pick, as it just reached a key level of support. CHWY recently overtook the 20-day moving average, and this suggests a short-term bullish trend.

A well-liked tool among traders, the 20-day simple moving average offers a look back at a stock's price over a 20-day period. This is very beneficial to short-term traders, as it smooths out short-term price trends and gives 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.

Over the past four weeks, CHWY has gained 13.3%. The company is currently ranked a Zacks Rank #2 (Buy), another strong indication the stock could move even higher.

Looking at CHWY's earnings estimate revisions, investors will be even more convinced of the bullish uptrend. There have been 6 revisions higher for the current fiscal year compared to none lower, and the consensus estimate has moved up as well.

With a winning combination of earnings estimate revisions and hitting a key technical level, investors should keep their eye on CHWY for more gains in the near future.

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