Following our ‘Desktop Metal: Is Third Time the Charm?‘ post from March 17th, Desktop Metal’s stock (DM) failed to end the week above its 19-week EMA (body) or above its 27-week EMA (wick) best respected resistance lines.
As noted in the aforementioned post, the 19-week EMA (body) resistance line set the bar at $5.05, and since the opening price for the week was $5.01, DM had a second chance to break this line with its closing price for the week.
DM ended the week at $4.61.
Therefore the line was not broken.
EMA shift
However, an updated analysis of the weekly price action reveals that DM stopped respecting the 19-week EMA as the body resistance line and instead shifted to respect the 20-week EMA (registered on the same week as the 19-week EMA), now set at $5.09:
That happened because the 19-week EMA value got updated after the week ended (to include the closing price of that week) and the result was $5.00. Since the opening price of last week was $5.01 that line was invalidated.
While the wick resistance line remained the 27-week EMA, DM pushed the body resistance line one notch up, and that’s an indication of a relative strength. The bar is now set higher, at $5.09.
New Support Lines
A comparison between the above weekly chart with the weekly chart from the March 17th post shows two new additions: DM now registered support lines.
The best respected body support line was registered on the March 14th week by the 9-week SMA, and last week the 13-week EMA registered as the best respected wick support line.
Having new support lines is also a positive development for DM.
Daily View
An analysis of the daily chart shows that the best respected resistance lines ‘kept their jobs’ since the previous analysis, however their values were updated.
In addition, two support lines registered on the daily as well:
13-day (body) and 15-day (wick) EMA lines.
Zooming in:
