Opendoor flashes a highly bullish pattern as meme stocks surge

Opendoor stock price has risen modestly in the past few days, reaching its highest level since January this year. This rally has coincided with the ongoing stock market rally and the surge in meme stocks.Opendoor is soaring amid the meme stock rally The main reason why the OPEN stock is rising is because it is widely seen as a meme company, thanks to its surge last year that pushed it from a low of $0.42 in June to $10 in September.Meme stocks have woken up suddenly, with companies like Avis Budget, POET Technologies, Faraday Future, and Beyond Meat going parabolic for no specific reason.Opendoor is still seen as a meme company, thanks to its performance last week and its elevated short interest, which stands at 12% today.The company’s business is also in trouble, as evidenced by the last financial results and forward guidance. Its recent results showed that the company made $736 million in revenue in the fourth quarter of last year, down from the $1.08 billion it made in the same quarter a year earlier.The revenue plunged as the company sold fewer homes in the quarter. It sold 1,706 houses in the fourth quarter, down substantially from the 2,822 it sold a year earlier.It all purchased fewer homes during the quarter as the company continued to change its strategy. Opendoor made a loss is $62 million in the quarter.Most notably, analysts believe that Opendoor’s business will continue weakening, with the average revenue estimate for the last quarter being $668 million, down by 42% YoY. Its second-quarter revenue is expected to be $941 million, also a 29% YoY decline.On the positive side, the management is working to improve its financials. It has started leveraging agents on its platform and is moving into an AI-first company. Doing this will make it a more capital-light company.Opendoor is also intentionally reducing its inventory and focusing more on better unit economics. In this, it aims to buy 6,000 homes each quarter.As a result, the new management aims to become profitable this year.A key challenge for Opendoor is that the property market is showing some weakness during the ongoing Iran war, which has boosted mortgage rates higher.Analysts are pessimistic about the OPEN stock price, with the average estimate being $3.60, down by 34% from the current level.Opendoor stock price technical analysisTechnicals suggest that the OPEN stock price is on the cusp of a strong bullish breakout in the near term. That’s because it has been forming a giant falling wedge pattern, which is made up of two descending and converging trendlines.The stock has already moved above the upper side of the wedge, confirming its bullish breakout.At the same time, the Relative Strength Index has jumped above the neutral point at 50, while the two lines of the Percentage Price Oscillator (PPO) have formed a bullish crossover pattern.OPEN stock chart | Source: TradingViewTherefore, the most likely scenario is where the OPEN stock surges, potentially to the psychological level of $10, which is about 78% above the current level.