Wix.com Ltd. (
WIX) is a cloud-based web development platform known for its user-friendly website-building tools and growing AI-driven solutions. The stock has recently broken above a key resistance level at $170.24, signaling potential bullish momentum for swing traders. This analysis evaluates the setup, entry, target, stop loss, risk management, and technical considerations for a swing trade targeting resistance near $221.
Trade Setup
Entry:
Aggressive Entry: Enter on a daily close above $170.24 with strong volume, ideally above average. Current price (assuming near $170.24 post-breakout) offers immediate entry.
Conservative Entry: Wait for a pullback to $170.24–$172, where the level is retested as support, accompanied by a bullish candlestick pattern (e.g., hammer or bullish engulfing). This reduces risk but may miss the trade if no pullback occurs.
Suggested entry price: ~$171–$172 for a balance of confirmation and value.
Profit Target:
Primary target: $221, based on the next resistance level.
Partial exit: Consider taking 1/3 or 1/2 profits at an intermediate level (e.g., $190–$200, if prior swing highs exist) to lock in gains while letting the rest run to $221.
Revised Stop Loss: Once the price reaches $190, move your stop losses up to protect profits if momentum continues.
Stop Loss:
Place a stop loss below the breakout level to protect against a false breakout. A reasonable stop is 1–2% below $170.24, around $166.80–$168.
For tighter risk management, use a stop below the nearest swing low (e.g., $154.22), though this increases position size due to a wider stop.
Suggested stop loss: $166.80 (2% below $170.24 or 4% below an entry at $173), balancing risk and breakout validity.
Reward to Risk:
There is a 5:1 reward to risk ratio if WIX should hit the $221 mark (highly unlikely to do so by its earnings date in 12 days). Even if WIX can get to $200 before the earnings date, a solid reward to risk scenario plays out for this set-up.
Contingency: If WIX fails to hold $170.24 and breaks below $166.80, abandon the bullish setup. Alternatively, watch for a retest of $154.22 for a potential new swing low entry, though this would require reassessing the setup.