Quick Wins by the Algorithm

Glu Mobile Inc. (GLUU): Short-term Capital Gains

In a recent stock analysis of Glu Mobile Inc., Senior I Know First Analyst Ayush Singh reported on the algorithm’s forecast signals for the company on the short, mid, and long-term time horizons. While his main argument centered on the strong bearish signal for the 1-year time horizon, the stock showed good bullish signals for the short and mid-term ranges.

On January 20th, the algorithm showed a bullish signal of 1.29 for 1 month with a stronger signal of 19.66 for 3 months and a strong bearish signal of -44.80 for the 1-year time horizon. This parabolic trend shows that the stock will likely increase quickly on the short-term before reversing and dropping with greater momentum.

As of February 9th, GLUU has risen an astounding 27% in accordance with the algorithm’s short-term prediction. Based on the algorithmic forecast, the share price should continue to rise through the end of April 2016, before dropping by the beginning of 2017.

Glu Mobile Inc., founded in San Francisco in 2001, is a developer of mobile games of various genres designed for use on smartphones and tablets. The company is known for partnering with celebrities like Kim Kardashian and Katy Perry to create games popular among their fanbases. The most recent jump in GLUU share prices can be contributed to the announcement of a new exclusive multiyear contract signed with Taylor Swift to feature her in her own game.

As Singh discussed in his article from January 24th, mobile gaming companies have volatile stocks due to the cyclical nature of the industry. Stocks tend to rise dramatically in response to a company’s game going viral, but consumer interest in these popular games is fleeting and is reflected in subsequent drops in share price. Despite Taylor Swift’s boundless success over the last few years, it is probable that the same trend will occur with her game as well.

Glu Mobile Inc. is likely not a good pick for the long-term as displayed both by the algorithm and through an analysis of the industry that it is a part of. For now, the company is enjoying a boost in earnings and rapid stock growth, but only time will tell if Taylor Swift will be able to keep things heading in the right direction for this mobile gaming company. Analysts and the algorithm alike remain apprehensive.

Before making any trading decisions, consult the latest forecast as the algorithm constantly updates predictions daily. While the algorithm can be used for intra-day trading the predictability tends to become stronger with forecasts over longer time horizons such as the 1-month, 3-month and 1-year forecasts.

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