After going public in December, the stock has done incredibly well. After initially planning an initial public offering price in the range of $44 to $50, the company lifted that price several times.
With the stock sitting just below $200, many will find it hard to argue that Airbnb has been anything but a roaring success so far. However, the question lingers: Will it remain a success after it reports earnings?
Many consider the travel industry to be on the cusp of a major recovery following in the impact of COVID-19. If that’s the case, then Airbnb could be an early tell for the rest of the industry, including airlines, hotels and travel sites like Expedia (EXPE) - Get Report and Booking Holdings (BKNG) - Get Report.
After hitting its low in January, Airbnb embarked on a pretty steady ascent before topping out near $220 in mid-February.
I don’t really like to see stocks go into the quarter on a high note. It sets a high bar to hurdle and can create a sell-the-news event. With Airbnb stock, we don’t have to worry about that.
Shares are 15% off the highs, even after a notable bounce from this week’s low. Now the roadmap is more clear.
So far the 10-day and 21-day moving averages are acting as resistance. On the upside, the stock needs to clear $200 and these two moving averages to regain momentum on the long side.
Above $200 puts the the recent high near $208 on the table, followed by a push up to the highs near $220.
If Airbnb stock can clear all of these levels, the 261.8% extension from the initial IPO range - from $121.50 to $165 - is in play near $235.
On the downside, the levels are also clear, starting with the 50-day moving average. A break of this level puts the day-one high in play at $165, followed by a possible dip down toward $155 should Airbnb really start to fall.
If the bottom blows out and Airbnb begins a multi-week decline, the $121 area could be back on the table.