While the slight slump isn’t the end of the world - and with shares still up more than 6% over the past month - it’s disappointing given the report.
Revenue surged 70% year over year and beat analysts’ expectations, while adjusted earnings also beat estimates.
Like DocuSign (DOCU) - Get Report, CrowdStrike’s second-quarter and full-year outlook also topped consensus expectations. However, unlike DocuSign’s double-digit post-earnings rally, CrowdStrike can’t seem to draw in the buyers.
That said, DocuSign stock has been consolidating for almost a year. CrowdStrike’s consolidation has “only” lasted about six months.
Others in the space has been trading in a similar fashion, like Datadog (DDOG) - Get Report and Palo Alto Networks (PANW) - Get Report. However, NortonLifeLock (NLOK) - Get Report has been ripping higher lately.
Can CrowdStrike stock find its footing and push through resistance or are shares like to remain range-bound for the time being?
Some investors will critique technical analysis. They’ll argue that it’s a bunch of lines drawn on a chart, which is severely inadequate vs. fundamental analysis. In reality, using a mix of both analyses is the most optimal.
I view the technicals as a way to measure sentiment, seeing where buyers and sellers are eager vs. when they’re growing tired. It's also a great way to see where both groups see “value” in their respective position.
In the case of CrowdStrike, buyers have clearly grown tired near $225 but are ready to gobble up the stock near $180.
Shares were recently rejected from the $225 area as the stock now works on its fifth straight daily decline.
That’s a bit discouraging, but on the plus side, support is coming into play near a cluster of moving averages. Specifically, the 10-week and 21-week moving averages are buoying the stock.
For aggressive traders, they’re likely buying the dip. More conservative traders may wait for a test down to the 21-day and 50-day moving averages near $203 before taking on a long position.
However, if these moving averages fail to support CrowdStrike stock, sub-$200 could be in play, putting range support near $180 on the table.
On a rebound, see how the stock handles $225 resistance. Above $227 could put $251 in play.