 Okay, folks, welcome to our technical analysis of Twilio, ticker symbol, TWLO. What we're gonna talk about on this video is a bit about their earnings. Then we'll segue over to into the technicals and we'll do a deep dive into Twilio stock. And what I mean in the deep dive, I mean, what we wanna do is we wanna take a look at Twilio on the charts, not from a daily or an intraday view. What we wanna do is do a high level macro view, meaning I wanna take a look at the monthly charts, the weekly charts, the daily charts to get a feel for where the stock has been, how it's been performing of late in this somewhat dicey market. And that'll help us determine as to whether or not we wanna buy, sell, or hold Twilio on this earnings report. And if we do not want to buy Twilio on this earnings report, well then where would we want to enter the trade? And then finally what we're gonna do is we're gonna leave off with catalyst. And what I mean by catalyst is what could help propel the share price of Twilio higher if we decide if we wanted to get long of the shares? Now, before we go to the earnings report, I have to tell you, I do business with Twilio and frankly they are a cash generating machine. They're, every other day, they're taking X number of dollars out of my accounts for the SMS text alert service that we provide to our members. So I will admit to being biased towards the company and not in a bad way but actually in a good way because from where I sit, they're just printing money. So let's get to it. Let's get to the news after hours that sent the shares down lower in the after hours session. This is a four hour chart. You can see that we're down by about $4 per share, not a major drop here. The initial knee jerk reaction was to take the shares up higher. One thing I've learned from my years of trading is that the knee jerk reaction is 90% of the times the inaccurate reaction and of course, sellers moved in, took it off the highs of the session and you can see that we have been putting in lower highs and lower lows of late even prior to the earnings report. But this is a four hour chart, nothing to dictate whether or not we want to invest in the company to make an investment decision. We want to be better educated with regard to the charts from again, a higher level of you, monthly chart, weekly chart, daily chart at a bare minimum. So let's get to it. Okay, so the headline off of MarketWatch was Twilio shares climbed 4% on better than expected revenue. This is true, no doubt about it. But then the attention of traders was turned towards the EPS, Earnings Per Share. And here's where things get a little bit dicey. Their loss relative to a year ago period rolled in at 79 cents per share, versus 64 cents a share in the year ago quarter. Now it has me still optimistic about the shares is that revenue vaulted by 52% amazing growth year. Now moving on to Investors to Business Daily where you can see that they grew their active user base by 21% year over year. That's really nice growth. And obviously that helped fuel their sales growth, but unfortunately what hurt their EPS was their longer term investments in the company. And this is what you'd expect from a rapidly growing growth stock. This is what's going to happen. And what I think the market is gonna hold on to here, at least in the short term, is that due to the investments, Twilio said it expects a loss in the range of eight cents to 11 cents versus the analyst estimates of one set adjusted profit. So guidance, not wonderful, but certainly no reason to go shorting the shares unless the charts tell us otherwise. Because when you take a look at the IBD ratings on this company, I mean it's simply outstanding. The Composite rating of 97, the Industry Group Relative Strength, A plus. This is a sector that's in favor and the Accumulation Distribution rating, meaning the balance of shares being accumulated versus distributed is clearly bullish. Price change year to date, 205, nearly 206% on the year thus far and within the past four weeks it's up over three and a half percent. So longer term, I don't think that the news today out of Twilio is gonna amount to a hill of beans. I think that any pullback here is going to be an opportunity. The question is, is our opportunity on the pullback after hours or is there a better entry point to wait for these shares? To answer that question, let's go to the charts. Okay, so to begin our technical analysis of Twilio and as to whether or not we believe that the shares are a buy, sell, or hold, we're gonna begin with a monthly chart to get that higher level view to identify where the shares have been to get a feel for where they might be going. And you can see that from May through to July, the shares have become very, very frothy. That was reflected in the pullback that we saw in August, September. But what was nice here is that we broke out this month above the upper band of resistance. The however here is that we're beginning to see a fade, a large fade off the highs of the month. And that was going into earnings. Now this monthly chart is reflective of the after hours price action, our RSI putting in higher lows, no breakout yet, validating the monthly breakout on price. Stokes, not going the direction where you'd want them to, but they're still healthy. They're well above the 50 mark as reflected in dotted line here. And they could have quite possibly hooked back up continuing the rally here. So the monthly chart, I have to give this a bullish thumbs up, but the weekly charts and daily charts could influence as to whether or not I would want to buy these shares now or at a lower price, weekly chart. Now this weekly chart does reflect the after hours price action. Now we do have a couple of support levels below, which we bounced off of this evening, right around 288.50 per share. The question is, does this hold? And if it doesn't hold, where is it going next? The second line of support would be right down here at 275, 276 per share. We are seeing lower highs on RSI. We were seeing lower lows. The question is, do we break out on RSI or does price give away? And then we begin to break down to new lower lows. The jury's out. So this chart here, while still net bullish, does raise some eyebrows. Now looking at the daily chart, the daily chart, we went into the day clearly putting in lower highs. We double topped out. First peak was back on October the 18th. Second peak in lower high was on the 19th. We did break down to a new low on the 15th. So we are in a confirmed short-term downtrend. We did manage to break out on Friday, but today an effort to capitalize on that breakout saw a rejection and then of course, a sell-off on the news. Daily chart, RSI, lower highs, lower lows, still casting a trading down below the 50 mark. And what I always teach members is that when you have RSI and Stokes, Stokes in particular, trading down below the 50 mark, you'll see that rallies tend to fade, folks. So if they manage to rally these shares tomorrow, I would not be a buyer of the shares because my bet is, is that they're gonna do exactly as they did today. They rallied and then the shares faded. Now going back to the weekly chart, if we fail to hold 288.50, we're coming down here to around 277. This line is declining, so keep that in mind. So the longer it takes to get down to the support level, the lower the price is going to be. Now we can overlay some automated trend lines using Trendspider. This is a great tool for anyone, beginners and for experienced people like me. I use this as my spell check for technical analysis or if I'm gonna hurry, it's a really big helpful tool for new traders. It's very good if you're learning how to identify support and resistance levels, manually draw your support and resistance levels, and then click the button to see how accurate you are. Anyway, I digress. If you're interested, there's a 35% discount code below in the video description area. Use that link, 35% off. Let's get back to the analysis. If we break this support level of 288 or down at around 277, we can ultimately end up down here at around, let's call it, this is rising 250 to 255 per share. So what I wanna do here is I'm going to create alert. I'm not willing to buy the shares at the support level, but I do wanna get notified if we break through it. Okay, so my alert is set. I wanna know whether or not we break 288.50 per share on a daily timeframe. I put a couple of notes to myself to check the weekly charts for support levels below and we'll keep it active for five days. If it hasn't broken down below 288.50 within the next five business days, well then it's probably not going to in the short term anyway. I also wanna know when we hit this support level here, this is support level number one. I'm gonna keep my sensitivity fairly low. I could broaden it out if I wanna get in the neighborhood, but I wanna use a true number because ideally what you wanna see is an overshoot to the downside below the support level and then a bullish reversal bar to close back above it. Now this alert here, I wanna get notified if we break through, touch or bounce. Why do I wanna know if we break through it? Because I know that I have a much more interesting support level below here in green at which I would love to get long off Twilio. We're gonna keep this active for the next 10 days. We're good to go. And I wanna know if and when we hit this support level in green. Okay, so our alert for this support level in green is I wanna know when we touch or bounce a little bit of sensitivity, daily time. You know what, let's make this a one hour timeframe. Note to self, Twilio primary support level hit. This is really where I wanna get involved. This would make it a wish list stock. I wanna keep this active for about three weeks and we're good to go. So now let's talk about our catalyst that would send this stock up higher. Now, keep in mind that I'm looking for the price to come down significantly from where it is trading after hours. Now there are two catalysts that should help this company move up higher. One of which I already discussed and that is simply the fundamentals are outstanding. Despite today's earnings report, yes, the EPS rating is probably gonna come in a little bit but at this stage of the game for a growth stock, this is what you wanna pay attention to. Sales percentage changed last quarter and the three year sales growth rate and they are very, very strong and there's no sign of abating. In fact, the news was very good today implying that these metrics are only going to get stronger. Now the second catalyst and this is really for the benefit of those that are looking to swing trade for the very short term, the catalyst is a roughly three and a half days short squeeze potential but I would not bet on a short squeeze until we hit a primary support level as I documented on the chart earlier. So wait for support levels to get hit. Members, I'll be sending out alerts when we do execute a trade on Twilio. Most likely we will be entering this trade at some point in time. I'm a big fan of the company. Again, I am a customer and any sell off based upon this earnings report to me is an opportunity assuming that we get it at our predetermined price and for that we'll allow the alerts to do the work for us and ignore it until such time as our alerts fire off and we use a rules based approach of entering the trade only when the shares come to us, especially in a shaky market that we're in at current. Folks, if you got any value out of this video don't forget to hit the like button. Please subscribe to the channel and please leave a comment below. Do you agree with me? Do you not agree with me? And take a moment to take a look at this video I did on Sinovus Energy yesterday. Take a simple CVE. I think that we nailed the call on the reaction by the market to the acquisition news over the weekend. Just click this link here and you'll get to watch my technical analysis of CVE. Be well.