Thanks to the proposed ban on TikTok, shares of Snapchat and other social media rivals are basking in gains.
Can SNAP sustain its bullish run?
Snap Inc (SNAP): 4-hour
Snap Inc share prices zoomed up to the top of its ascending triangle pattern visible on the 4-hour time frame, and it looks like there’s enough momentum for a break higher.
If that happens, SNAP could rally by the same height as the chart formation, which spans around $7.00 to $12.00. But what are technical indicators suggesting?
Stochastic is closing in on the overbought region to hint at weakening upside pressure, but the oscillator has yet to turn lower before reflecting a return among sellers.
Meanwhile, the moving averages are bracing for a bullish crossover that might attract even more buyers. These indicators also line up with the triangle support to add to its strength as a floor on dips.
So far, the company’s shares are up nearly 10% this week after U.S. lawmakers shared plans to sanction or ban the Chinese-owned video service.
Bi-partisan support is growing for this proposed legislation, and rumor has it that the White House is also working with Congress to endorse a bill called the “Restricting the Emergence of Security Threats that Risk Information and Communications Technology (RESTRICT) Act.”
Although this proposal still faces plenty of political opposition, further developments could mean more upside for other U.S. social media companies, including Meta (Instagram Reels), Alphabet (YouTube Shorts), and Pinterest.
Among these rivals, though, Snap Inc could be poised to be the biggest beneficiary since it offers more or less the same features as TikTok.
