Shares of HP  (HPQ - Get Report)  were pounded on Friday, closing lower by 9.57% at $16.64.

The stock is hitting new 52-week lows in the session, after management announced a major restructuring.

HP plans to eliminate 7,000 to 9,000 jobs from its current workforce of 55,000 employees. The move will take place over the next three years and save the company $1 billion.

On the downside, the restructuring will hurt its 2020 GAAP earnings, although on an adjusted basis, management provided an above-consensus outlook. Still, Wall Street isn't having it, with shares spiraling lower. That's why it's Real Money's Stock of the Day. 

Worth noting is that Hewlett Packard Enterprise (HPE - Get Report) is down too, falling about 1.5%.

Let's look at the charts to see where HPQ stock may bottom.

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Trading HP Inc. Stock

Daily chart of HP Inc stock.
Daily chart of HP Inc stock.

As investors can see in the daily chart above, Friday's decline is not a phenomenon. In fact, HPQ stock has been making a series of lower highs all year.

HP stock is below all of its major moving averages and retracement levels, and is now below its prior 52-week low of $16.96.

So what now? We might see some reprieve from the selling near $16.25 to $16.50, where HPQ stock has downtrend support coming into play. Otherwise, we may need to see a test of the $16 mark, as highlighted on the long-term weekly chart below.

Weekly chart of HPQ stock.
Weekly chart of HPQ stock.

This was as a significant level from late 2014 to mid 2017 and at least in the short term, should HP stock test this mark, I would expect it to be good for a bounce.

Below this area could eventually push HPQ stock down to $14.50, where it has a Fibonacci extension. Should support hold and a rebound ensue, the upside targets are very clear.

First look to see if HPQ stock can reclaim the $17 mark, near where it's prior 52-week lows were. Next, see if HP can reclaim $18, an important support level through 2019. While its key moving averages are currently above $18, see if they act as resistance when HP stock eventually retests them. That's true whether that test comes above $18 or below it. 

Until then, let's see if HP Inc. stock can bottom near $16. 

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