Stock Of The Day – Is MARA About To Rally?

Trading in MARA Holdings, Inc. (MARA) is quiet Wednesday. But the shares may be about to rally and head higher.

This is why MARA is the Stock of the Day.

If a stock is trending lower, it is because the market is out of equilibrium. There is more supply than demand.

This means that there are more shares for sale than there are to be bought. This forces sellers to undercut each other and offer their shares at discounts if they want to draw buyers into the market. This puts the shares into a downtrend.

When a stock drops to a support level, the buyers come out of the woodwork. There is enough demand, or shares to be bought, as there is supply or shares to be sold. Sellers are no longer forced to undercut each other. This results in the selloff ending.

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As you can see on the chart, there has been support for MARA around the $9.85 level. This is where the moves lower ended in April and November. You can also see that MARA has now dropped to this support for a third time.

Sometimes stocks rally after they reach a support level. This is what happened in April and November.

Stocks rally off support levels when buyers become impatient and anxious. These traders know that the seller is going to go to the buyer who is willing to pay the highest price for their shares.

As a result of this, these anxious buyers increase the prices they are willing to pay. Other anxious buyers see this, and they do the same thing.

This could result in a bidding war or snowball effect that results in the price moving higher.

This is what happened with MARA in April and November. Now there is a good chance that it happens once again. 

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