MELI is an online platform in Latin America. It operates 2 business; e-commerce operations and online trading platforms.
The only reason it interests me is because it provide an opportunity to play ‘tech stocks’ in Latin America; a possible growth area and maybe M&A down the road.
MELI charts shows a surge in price yesterday breaking out of its previous trading range.
From the chart, we can see that the previous trading range is identified by the box. The price surge and break the next resistant level at 18.78.
At this moment, I do not know what causes the price surge. I expects that there will be a little pullback.
Or, if it continues to goes up, we should see a resistant at 21.50.
– A vertical spread for the short term.
– Or hold the stock long term. (and bet that it will either become number one in the market place or they get acquird for a premium)
However, the risks exists for this stock. It has very low volume. At less than 2million, it does not take a lot for price to be push up before it gets dumped.