Under Armour (UA) - Get Under Armour, Inc. Class C Report  stock was trading at $16.40, down 9.4% midday, after opening Tuesday's session with yet another post-earnings breakdown gap. The stock was off just over 7% on the bell, taking out the July lows in the process. This nasty breakdown has driven Under Armour back down to a major support zone. If the stock can regain its footing in this important zone, a low-risk entry opportunity will develop for patient bulls.

As last January came to a close Under Armour suffered an extremely damaging flush. The stock's 13% earnings-inspired collapse sparked a massive selling wave. It was the second straight post-earnings breakdown and by mid March, shares had fallen over 55% from the 2016 summer highs. Needless to say, Under Armour had reached a deeply oversold reading on multiple indicators. Shortly after the March lows, the stock began to consolidate.

For the last six months, Under Armour has remained in a very narrow range. A couple of attempts to break to the upside, one in late April and another in mid June, failed badly but the March lows were able to contain the downside. This area, just above $18.50, which held the March and May lows, is being testing under heavy pressure again Tuesday. A hold here would develop into a very low risk entry opportunity.

In the near term, investors should keep a close eye on the $18.50 to $17.50 area. If stabilization begins in this zone, a major low could be in place. On the downside, a close below $17.00 would be a clear warning sign that a deeper decline is on the way.

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In addition, Under Armour sports a high short interest ratio (11.6). This could add considerable upside fuel if a bottom, even a temporary one, is reached this week.

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