Look out below.

So far this week, Home Depot (HD) - Get Report has managed to stabilize above a key support area. But, a fresh down leg may be just ahead. The stock's steep selloff last week has left shares quite vulnerable. If Home Depot is unable to hold the $150.00 support zone through the end of this week, an area that includes the March high, Friday's breakdown could enter a second leg.

As last week began, shares of Home Depot appeared headed for a breakout. This bullish action was completely reversed by Friday's close. After reaching fresh June highs on Monday June 19 the stock sank to new June lows as the week came to an end. This damaging downside reversal, which included the stock's heaviest volume of the year on Friday, likely has further to run.

Considering the rather ominous topping pattern now in place at the May/June highs a clear break through support near the March high could open up the downside. The next key support zone is near $146.00. This area includes the February high and the March low. The basing action during this time frame was very solid, and provided the footing for Home Depot's final post-election rally leg. If this area doesn't hold, a retest of the 200-day moving average near $140.00 is likely on the way.

In sum, investors should be somewhat patient when it comes to new money for Home Depot. Following last week's breakdown, this A-rated stock will need to spend some time repairing the damage which, in this case, should lead to lower prices.

Home Depot's shares rose 0.3% to $152.63 on Wednesday morning.

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This article is commentary by an independent contributor. At the time of publication, the author was long Home Depot.