There's no other way to put it. The reaction to Dave & Buster's (PLAY) - Get Report first-quarter earnings report is nothing short of a disaster, with shares closing at new 52-week lows on Wednesday, down 22.4% at $40.00.

What did the company do to deserve this?

Earnings of $1.13 per share missed consensus expectations of $1.15, while revenue of $363.6 million came up well short of analysts' estimates of $372 million. Comparable-store sales declined 30 basis points year-over-year, too.

The retail sector has been a disaster so far this quarter. Just ask Kohl's (KSS) - Get Report , Canada Goose (GOOS) - Get Report or Abercrombie & Fitch (ANF) - Get Report , for instance.

But even though Dave & Buster's missed on earnings and revenue estimates, we don't usually see a 20% hammering to new lows for that. The stock needs something worse for that to happen. With Dave & Buster's, we have that too. Management slashed its full-year outlook for both earnings and revenue, which has drawn in a wave of price and ratings cuts from the analysts. It's also what's weighing on the stock so much on Wednesday. 

When will the selling end?

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Trading Dave & Buster's Stock

Weekly chart of Dave & Buster's stock.

Shares of Dave & Buster's stock are making an ugly move and blowing through multiple levels of support. That's just what one would expect when a stock is taking a 20% haircut, though. PLAY stock has blown right through uptrend support (blue line), the 200-week moving average and a notable level between $42.50 and $43.

It leaves the stock floating in no man's land to some degree, with the next direction uncertain. The market could decide on Thursday that the selloff was overdone and bid Dave & Buster's stock back up over $42.50. Conversely, the pain could be just getting started and we could see shares flush into next week.

Unfortunately, we don't know which one it will be. Fortunately, we can still trade around it.

If PLAY stock can reclaim the $42.50 to $43 area, it could have room to run up to the $44.40 area, the 50% retracement for its entire range over an almost a five-year span. Above that could squeeze shares up toward $48, the backside of prior uptrend support.

However, should Dave & Buster's stock continue to work its way lower over the coming days, weeks and possibly months, let's see how $37.50 does as support. This area has been a notable low point over the past two years, while the 38.2% retracement rests near $37.70.

At least from a risk/reward standpoint, a buy on this type of pullback seems attractive, because if we're wrong, we can get right out. If we're right, Dave & Buster's stock could rebound to and beyond $42.50.

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