Skip to main content

American Eagle Clings to Support After Earnings Dump — Chart

American Eagle Outfitters stock is getting smacked after reporting earnings. Here's the must-hold level of support.

Shares of American Eagle Outfitters  (AEO) - Get American Eagle Outfitters, Inc. Report are getting hit hard on Thursday, down about 10% after reporting earnings.

Coincidentally, Chewy  (CHWY) - Get Chewy, Inc. Class A Report is also suffering from a similar post-earnings selloff on the day.

American Eagle revenue of $1.19 billion missed analysts' expectations of $1.23 billion, although earnings topped expectations.

Analysts were looking for a better sales figure ahead of the back-to-school season and as the economy continues to rebound.

Is the selloff an overreaction? Perhaps, particularly as American Eagle stock was already down 23.2% from the 2021 high ahead of the print. It’s even got one Real Money contributor buying today's pullback.

Let’s look at a key support area that the stock is trying to hold.

American Eagle is a holding in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells AEO? Learn more now.

Trading American Eagle Stock

Scroll to Continue

TheStreet Recommends

Daily chart of American Eagle Outfitters.

Daily chart of American Eagle Outfitters.

American Eagle stock topped a penny shy of $39 earlier this summer before embarking on a multi-month decline. Amid that slide, the stock lost all of its daily moving averages.

Now sitting near $27.50, shares are holding a key level on the chart.

Although the stock slightly broke below both measures, American Eagle has reclaimed the 50-week moving average and the 61.8% retracement of its range from the 2020 low to the 2021 high.

For those that are aggressive and want to be long this name, they can use a close below Thursday’s low as their stop-loss.

A break of that level could put $25 on deck.

On the upside, a move over Thursday’s high (currently at) $28.37 could open the door to the 200-day moving average. Above that and the gap-fill mark near $30 is possible.

It has not been an easy ride for American Eagle stock lately.

Not only is the stock down big from the highs a few months ago, but it’s putting in its fourth straight daily decline and sixth loss in the last seven trading sessions.