{"id":13076,"date":"2025-05-09T00:01:31","date_gmt":"2025-05-09T00:01:31","guid":{"rendered":"https:\/\/investingsstrategist.com\/index.php\/2025\/05\/09\/dont-buy-robinhood-stock-until-you-see-this-chart-setup\/"},"modified":"2025-05-09T00:01:31","modified_gmt":"2025-05-09T00:01:31","slug":"dont-buy-robinhood-stock-until-you-see-this-chart-setup","status":"publish","type":"post","link":"https:\/\/investingsstrategist.com\/index.php\/2025\/05\/09\/dont-buy-robinhood-stock-until-you-see-this-chart-setup\/","title":{"rendered":"Don\u2019t Buy Robinhood Stock\u2026 Until You See This Chart Setup"},"content":{"rendered":"
\n

Robinhood Markets, Inc.<\/strong> (HOOD) is back in the spotlight, wrestling with its four-year highs and turning heads on Wall Street. It debuted in 2021 as an IPO darling, capturing the imagination of young Gen Z traders before its dramatic fall as a meme stock fueled by crypto and an unhealthy dose of FOMO.<\/p>\n

Now, with year-to-date gains outpacing the S&P 500<\/strong> ($SPX), the former disruptor is looking to claim its space as a serious contender rather than a speculative fad.<\/p>\n

Robinhood Stock\u2019s Price Action: Breaking Out or Topping Out?<\/h2>\n

If you\u2019ve been checking the StockCharts Technical Rank<\/a> (SCTR) Reports, you\u2019ve probably noticed the stock popping up on the Large Cap Top 10 list.<\/span><\/p>\n

FIGURE 1. SCTR REPORT LARGE CAP TOP 10. Robinhood is second from the top.<\/span><\/p>\n

If you\u2019re eyeing HOOD, you\u2019re likely asking two key questions: How is it performing relative to its Financials sector peers, and how strong is the sector itself in terms of market breadth? Just as important, you\u2019ll want a longer-term view: How has the stock held up over time, both on its own and compared to the broader S&P 500?<\/p>\n

Let\u2019s tackle all those questions in one shot.<\/p>\n

Financial Sector Breadth Shows Bullish Tailwinds for HOOD<\/h2>\n

The chart below<\/a>, which tracks the Financial Sector Bullish Percent Index, offers a quick read on sector strength and market positioning.<\/span><\/p>\n

NOTE: The BPI spans three years.<\/em><\/p>\n<\/p>\n

FIGURE 2. FINANCIAL SECTOR BPI. Market breadth and comparative price performance look exceedingly bullish.<\/span><\/p>\n

From a breadth perspective, the Financial sector looks bullish, bordering on overbought, with over 82% of the stocks within the sector triggering Point & Figure Buy Signals<\/a>, according to its <\/span>Bullish Percent Index<\/a> (BPI) reading. Meanwhile, HOOD is crushing it on a <\/span>3-year relative basis<\/strong>\u2014outperforming its sector by 250% and the S&P 500 by nearly 300%.<\/span><\/p>\n

This paints a bullish picture. But before jumping to conclusions, let\u2019s take a step back and look at HOOD\u2019s price history, going back to when it IPO\u2019d in 2021.<\/p>\n

From Meme Craze to Measured Recovery<\/h2>\n

Check out the weekly chart<\/a> below.<\/span><\/p>\n<\/p>\n

FIGURE 3. WEEKLY CHART OF HOOD. It\u2019s above the 10-week and 40-week SMAs, but it has quite a distance to go before testing its yearly high.<\/span><\/p>\n

You don\u2019t need annotations to spot where HOOD\u2019s meme-stock frenzy peaked and where the crash began, fueled by a sharp drop in retail trading activity, crypto market volatility, and intensifying regulatory pressure.<\/p>\n

After basing for two years, HOOD began picking up steam in 2024. Its improving technical strength is reflected in the sharp spike of its SCTR, breaking above the 90 line. Fundamentally, HOOD began to recover as it started raking in profits, expanding its product lineup, and reigniting its user growth.<\/p>\n

It\u2019s trading above its 10-week and 40-week simple moving average<\/a> (SMA), which is equivalent to a 50-day and 200-day SMA, respectively. Still, it has quite a way to go before testing its high of $66.90.<\/span><\/p>\n

Short-Term Trading Setup<\/h2>\n

If you\u2019re looking to buy HOOD, you\u2019ll need to zoom in to find favorable entry points. Let\u2019s switch over to a daily chart<\/a>.<\/span><\/p>\n

<\/h2>\n

FIGURE 4. DAILY CHART OF HOOD. Support levels are clear and accumulation looks promising.<\/span><\/p>\n

HOOD was in an intermediate-term downtrend starting in early February, where it peaked at $66.90, all the way down to the early part of April, where it bottomed sharply at around $29. HOOD quickly recovered, breaking above $50 (a local swing high) to $54, where it is now (at the time of writing).<\/p>\n

Can HOOD Hold Its Gains or Is Consolidation Coming?<\/h2>\n

The Stochastic Oscillator <\/a>warns that HOOD may be overbought and due for a pullback. Here are a couple of scenarios to consider, and note that the <\/span>Ichimoku Cloud<\/a> visually provides a wider range of potential support:<\/span><\/p>\n

Watch for support at $46 or $39<\/strong>, both recent swing lows.
\nIf it stalls between those levels<\/strong>, it could signal a failed breakout and continued consolidation until a new catalyst emerges.
\nIf it drops below $39<\/strong>, the next key level is at $29, but be a little cautious at that point, as such a deep retracement may indicate weakening momentum, sentiment, and fundamental weakness.<\/p>\n

On the bullish side of things, the Accumulation\/Distribution Line<\/a> (ADL), currently well above the price, is indicating strong accumulation, suggesting that demand is outpacing supply\u2014which, if it continues, can drive prices higher.<\/span><\/p>\n

At the Close<\/h2>\n

Robinhood\u2019s stock price is showing real signs of strength, not just on a chart, but in its fundamentals. With relative performance beating its sector and the S&P 500, and strong accumulation under the surface, HOOD\u2019s comeback narrative is gaining technical validation. But with overbought signals flashing and key support levels in play, the next move may depend on whether bulls defend the breakout, or if the stock consolidates further while waiting for its next catalyst.<\/p>\n

In either case, keep a close eye on volume, momentum shifts, and those support zones. HOOD may still have more room to run, but timing your entry could make all the difference.<\/p>\n<\/p>\n

Disclaimer:<\/em><\/strong> This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your personal and financial situation, or without consulting a financial professional.<\/em><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Robinhood Markets, Inc. (HOOD) is back in the spotlight, wrestling with its four-year highs and turning heads on Wall Street. It debuted in 2021 as an IPO darling, capturing the imagination of young Gen Z traders before its dramatic fall as a meme stock fueled by crypto and an unhealthy dose of FOMO. Now, with […]<\/p>\n","protected":false},"author":0,"featured_media":13077,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-13076","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-stock"],"_links":{"self":[{"href":"https:\/\/investingsstrategist.com\/index.php\/wp-json\/wp\/v2\/posts\/13076","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/investingsstrategist.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/investingsstrategist.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/investingsstrategist.com\/index.php\/wp-json\/wp\/v2\/comments?post=13076"}],"version-history":[{"count":0,"href":"https:\/\/investingsstrategist.com\/index.php\/wp-json\/wp\/v2\/posts\/13076\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/investingsstrategist.com\/index.php\/wp-json\/wp\/v2\/media\/13077"}],"wp:attachment":[{"href":"https:\/\/investingsstrategist.com\/index.php\/wp-json\/wp\/v2\/media?parent=13076"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/investingsstrategist.com\/index.php\/wp-json\/wp\/v2\/categories?post=13076"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/investingsstrategist.com\/index.php\/wp-json\/wp\/v2\/tags?post=13076"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}