Shares of Momo, a Chinese social networking platform, are on fire. The stock has soared 70 percent this year, far outpacing its U.S.-based counterparts Facebook and Twitter, up 4 and 33 percent, respectively, in the same time period. One technical trader is betting on more gains when the company reports earnings later this month.
“We are heading into earnings on Aug. 22, and I’m seeing the overall Chinese market start to bottom. Momo looks solid here,” said Todd Gordon, founder of TradingAnalysis.com, Thursday on CNBC’s “Trading Nation.”
Examining a chart of Momo, showing the stock’s hefty year-to-date gains despite trading off its all-time high in June, Gordon identified technical resistance around $40 per share that’s turned into a level of support.