Shopify Inc. (SHOP) shares rose more than 5% during Wednesday's session to retest 52-week highs. Driven by strong growth and profitability over the past few years, the stock is up more than 120% so far this year following a nearly 40% gain last year, although many analysts have concerns over the valuation.

The latest move comes ahead of its second quarter financial results before the market opens on Aug. 1, 2019. While the company posted positive earnings surprises of between 25% and 83% over the past four quarters, the stock's reaction to these beats has been mixed due to its at-times lofty valuation.

Earlier this month, Barron's suggested that Shopify could grow into its valuation in the same way that, Inc. (AMZN) has over the past decade. Barron's believes that the launch of the Shopify Fulfillment Network marked a big step toward becoming a viable Amazon alternative by giving merchants the ability to offer timely deliveries under their own branding with affordable shipping rates.

Chart showing the share price performance of Shopify Inc. (SHOP)

From a technical standpoint, the stock is retesting prior highs made in late June. The relative strength index (RSI) is moving toward overbought levels with a reading of 63.75, but the moving average convergence divergence (MACD) could see a near-term bullish crossover. These indicators suggest that the stock could see some near-term consolidation before experiencing a renewed bullish trend higher.

Traders should watch for a breakout from prior trendline resistance to fresh 52-week highs or some consolidation just below those levels before an attempted breakout. If the stock breaks down from trendline support and the 50-day moving average, the stock could see a move to prior lows of $280.00 or $260.00, although that scenario appears unlikely at this point.

The author holds no position in the stock(s) mentioned except through passively managed index funds.