Trump Media & Technology Trading Volume Falls Amid Expensive Valuations And Bearish Charts: Here's What Technical Analysis For DJT Stock Shows

Trump Media & Technology Group Corp. DJT had thin trading volumes on Tuesday as its valuations have skyrocketed and its stock has fallen since the reelection of President Donald Trump, the recent charts point towards a weakness in the stock.

What Happened: DJT’s trading volume was significantly lower than average as of Tuesday’s close. Only 3.53 million shares were traded compared to the average of 20.03 million.

The technical analysis of its simple daily moving averages signals a downtrend with mixed momentum indicators.

DJT shares closed Tuesday at $30.62, lower than its 200-day simple moving average of $32.56, and 50-day average at $34.47. It was also lower than its eight-day average of $31.16 and the 20-day average of $34.87. This indicates a bearish downtrend.

However, the momentum indicators were mixed. The relative strength index of 40.59 showed that the stock is in the neutral zone. whereas the negative MACD (moving average convergence/divergence) indicator of 1.27 suggests potential for downward momentum in the near term.

According to Benzinga Pro, the company has a price-to-sales ratio of 1,013, signaling the company is overvalued. The price-to-earnings ratio cannot be used as the metric to compute valuation as the company had an operating loss of $23.7 million and a net loss of $19.2 million, in the third quarter.

Why It Matters: Trump held 57% of the company, however, in December he transferred his entire stake of 114,750,000 shares to Donald J. Trump Revocable Trust of which he is the sole beneficiary. The DJT stock, which soared after Trump won the election, has declined 9.78% since Nov. 5.

Additionally, Trump Media is expanding its footprint in the financial services sector with the launch of Truth.Fi, which is a fintech division aimed at creating investment opportunities with a focus on cryptocurrency.

The company's board has approved a financial strategy that involves investing up to $250 million of its $700 million cash reserves in a range of financial instruments, including tailored exchange-traded funds (ETFs), separately managed accounts (SMAs), and Bitcoin.

CEO Devin Nunes is positioning Truth.Fi as the financial arm of its media network, which already includes Truth Social and the streaming platform Truth+.

The company plans to develop investment products focused on American-first industries, targeting growth sectors such as manufacturing, energy, and crypto/blockchain assets.

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