Verizon Has Major Support Ahead of Earnings Here

Verizon needs to hold support should shares dip after reporting earnings. Here's the must-know level for the stock.
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Verizon Communications  (VZ) - Get Report shares were creeping higher, up a little less than 1% ahead of its earnings report on Friday.

The company will report its first-quarter results before the market opens, following AT&T’s  (T) - Get Report quarterly report on Wednesday. The latter missed on both earnings and revenue estimates as investors digested the company’s continually expanding businesses.

Unlike AT&T, Verizon has a more straightforward business with less “noise” in the numbers. Investors are hoping the results will be good, which will keep the good times alive.

Shares already have rallied 21% off the lows as bulls have made some serious progress over the past few weeks. In fact, there are some very clear levels to keep an eye on once Verizon reports its results. Let’s have a look.

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Trading Verizon Stock

Weekly chart of Verizon stock.

Weekly chart of Verizon stock.

A look at the weekly chart immediately shows several key levels. First, the $57 mark is a critical level that Verizon stock needs to hold should shares dip on Friday. This mark was resistance from the fourth quarter of 2018 until September 2019, when shares broke out over it.

The breakout propelled Verizon stock up to $61, before the stock eventually faded back below this breakout level amid the coronavirus selloff. However, $57 is also where the 50-week moving average comes into play.

Even if the stock temporarily breaks below it, investors will want to see the stock end the week above $57. In short, bulls really need to hold this level.

If they can’t, it puts more downside in play. Specifically, it puts the rising 100-week moving average in play near $54. Below that mark and technically speaking, $50 is possible. Although to get there I think we would need very poor quarterly results along with some notable selling pressure in the overall market.

On the flip side, if Verizon stock holds $57 after earnings or rallies on the results, it puts $60 in play. The stock has had trouble gaining traction over this level. If it can do so and close above it, it puts the 52-week highs in play.