Twitter (NYSE: TWTR) pushes higher on Wednesday's trading session, surpassing the $32 per share, the highest level reached since March 12th.
The short-term overview of TWTR exposed in the 2-hour chart, reveals that after the surpassing of the descending trendline that connects the end of wave (v) and (b) of Minuette degree labeled in blue.
Twitter began an upward structural series on March 18th, when the price found fresh buyers after the massive sell-off started in mid-February. The bullish movement developed by TWTR developed the technical formation as a leading diagonal pattern, which began in its March low at $20.02 per share.
The Elliott wave theory defines the leading diagonal as a structure formed by five internal overlapped segments, which tends to appear in a wave 1 or A.
On the previous chart, we observe that the bullish leading diagonal pattern was completed on April 29th, when TWTR found sellers at $31.49 a share, completing a wave ((i)) or ((a)) of Minute degree labeled in black. After this completion, the price reacted bearishly, developing the three-wave sequence corresponding to wave ((ii)) or ((b)) in black. This corrective movement developed by Twitter, which looks like a regular flat pattern, ended on May 14th, when the price found the incorporation of fresh buyers at $27.12 per share.
The bounce-off experienced by TWTR and its price boost to a new higher high activated a new upward wave, which corresponds to wave ((iii)) or ((c)). In this context, and according to the Elliott wave theory, if the price movement advances above the 161.8% of the Fibonacci expansion, the current upward wave should be labeled as wave ((iii)). In the opposite case, it is possible that the existing structure would correspond to a corrective formation.
On the other hand, the RSI oscillator moves above 70%, which confirms the bullish bias. The current level of 78.54% suggests that TWTR could be in an overbought zone; thus, a limited correction might occur, which would allow traders to add positions to the long-side.
In conclusion, our preferred positioning remains on the bullish side while the price action continues moving above $27.14 per share, which corresponds to the origin of the current upward move.