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Shares of Uber (UBER) shot higher by almost 2% in early Monday trading, giving investors hope that the long-awaited breakout was underway.

By the close though, shares of Uber were down 1.44% to $43.88. That's better than the 2.2% loss the stock was sporting earlier, but the action has been disappointing to say the least. Given Uber's history as a public company thus far, investors have been used to disappointment. 

Uber stock went public in May at $45 a share before shares fell almost 20% in two days. The underwhelming public reception came after Lyft's (LYFT)  initial public offering, which also disappointed investors.

Uber stock has tried over and over again to recapture its IPO price of $45, but with the exception of a few short-lived rallies the breakouts have all fizzled out. The company will report second-quarter earnings on Aug.8 after the market closes. Will shares rally ahead of the event, potentially breaking out ahead of the quarterly results?

It's possible, although the stock has severely lacked any long-lasting bullish sentiment, a necessary catalyst to kick-start a significant breakout. That said, the charts continue to point to a likely breakout as the stock hovers just under the key $45 level.

Trading Uber Stock

Daily chart of Uber stock.
Daily chart of Uber stock.

There's good news and bad news with Monday's false breakout in Uber stock. The bad news is rather obvious: Uber opened near $45, jumped to $45.62 and then failed to not only hold up above $45 but fell lower on the day.

However, the good news is that it held all sorts of key levels. First, it held uptrend support (blue line), which underscores the stock's series of higher lows, a bullish technical development. Second, it held its newly defined 50-day moving average, which has been a key level over the past week. The last of the bullish news is that Uber stock reclaimed both its eight-day and 20-day moving averages. So while the stock wasn't able to break out, the setup is still intact.

Traders and investors alike now have a well-defined setup. Either Uber stock will push above and close north of $45 or it will break below support.

If it's the former, look for a close above $45 to trigger a rally up to the highs near $47. It Uber stock can clear $47.08, then $50+ is on the table. On the plus side, the momentum-measuring indicator, the MACD at the bottom of the chart (blue circle), is swinging in bulls' favor.

On the downside, see that the 50-day moving average holds as support. If it fails, shares will likely head lower and the breakout setup will have failed.

This article is commentary by an independent contributor. At the time of publication, the author had no positions in the stocks mentioned.