On the back of some large announcements, Zip Co Ltd [ASX:Z1P] rocketed up 72.33% from the close last week to $6.58 at the time of writing.
Being one of the larger players in the buy now, pay later space (BNPL), Zip’s business saw a large influx of new users recently, with it reporting customer numbers increased to two million, up 66% year-on-year and 70,000 new users added in a month.
What’s been happening with Zip
On 1 June Zip requested to be placed in a trading halt, pending an announcement.
What followed was news of a capital raising of $200 million, coupled with the acquisition of Quadpay, a New York-based buy now, pay later provider.
With the US retail market being valued at $7.35 trillion and Quadpay one of the leading BNPL platforms, the market was clearly enthused with the acquisition.
With the purchase of Quadpay, ZipPay will have a presence in five countries; Australia, New Zealand, South Africa, the United Kingdom, and the largest of all, the United States.
Combined this exposes Z1P to over $6 trillion of retail sales.
Where to from here for Z1P share price
The acquisition of Quadpay coupled with the capital raising is being viewed positively, which is reflected in the current stock price. Looking at the technical side of things can give us a clearer view of where all this may be heading.
The Z1P share price created a new all-time high of $6.58, and should the run-up continue, it may find some resistance at the level of $6.90.
This level is based on placing price extensions on previous ranges.
To the downside, it can be seen on the chart where a gap has been created in the price (red rectangle).
Sometimes when this occurs, the share price can return to these levels to ‘fill the gap’ so to speak.
Should this take place, then historical support levels of $3.84 and $3.45 may come into focus.
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