Shopify Inc. (NYSE:SHOP) shares are trading lower, continuing to fall after reporting worse-than-expected financial results Wednesday morning.
Shopify reported quarterly revenue of $1.38 billion, coming in below the estimate of $1.69 billion. The company reported quarterly earnings of $1.36 per share, coming in below the estimate of $1.58.
Shopify was down 10.99% at $664.77 at time of publication.
Related: PreMarket Prep Stock Of The Day: Shopify
Shopify Daily Chart Analysis
- The stock fell below the higher low trendline and then saw a steep drop off. The break below the trendline was a bearish sign as the stock was unable to continue forming the upward trend. The stock may continue to freefall until it begins to form higher lows again.
- The stock trades below both the 50-day moving average (green) and the 200-day moving average (blue), indicating the stock’s sentiment has been bearish. Each of these moving averages may hold as an area of resistance in the future.
- The Relative Strength Index (RSI) dipped lower Thursday and now sits at 29. This shows that the stock is in the oversold region and is seeing much more selling pressure than it is buying pressure. The price may continue falling if the RSI stays in the oversold region.
What’s Next For Shopify?
Shopify broke below the higher low trendline and followed with a strong bearish move. The stock has been in a freefall and may not recover until it shows it can form higher lows once again.
Bullish traders want higher lows and for the RSI to climb out of the oversold region and cross above the middle line of the indicator. Bearish traders are in control of the stock and want to see the stock continue to fall.
