Roblox Stock Skyrockets: What's Going On And What's Next?

Roblox Corp. RBLX shares were trading higher Tuesday after the company announced better-than-expected third-quarter earnings results. The company reported a quarterly earnings loss of 13 cents per share, beating the estimate calling for a loss of 14 cents per share. The company reported quarterly revenue of $509.3 million.

Roblox was up 35.49% at $104.70 at last check.

Roblox Daily Chart Analysis

• The stock saw an extremely large gap higher and broke out of what technical traders call a falling wedge pattern.
• The price has been falling and been condensed between narrowing highs and lows and was hanging near pattern resistance for a while, hinting at a breakout. Earnings came out and the stock saw the large breakout with a gap up higher.
• The stock trades above the 50-day moving average (green), indicating the stock is likely facing a period of bullish sentiment.
• The 50-day moving average may hold as an area of support in the future for the stock.
• The Relative Strength Index (RSI) shot higher Tuesday and now sits at 71. This shows after the good earnings came out the stock saw a large increase in the amount of buyers in the market.

See Also: Why Roblox Shares Are Rising Today

What’s Next For Roblox?

Bullish traders would like to see how far the stock will run, and once it cools off they are looking for a period of consolidation while maintaining the gains the stock made. After some consolidation, bulls are looking to see the stock form higher lows and continue to climb.

Bearish traders are looking to see the stock start to fade lower the next few weeks and fall back to where the stock was trading when it traded within the wedge pattern. Bears hope the stock could fall below pattern support, possibly signaling a further bearish push is on the way.