Zoom Video Shares Crash After Earnings: What's Going On And What's Next?

Zoom Video Communications Inc. ZM shares were trading lower Tuesday after the company announced fiscal third-quarter financial results and guidance.

The company is expecting 2022 fourth-quarter adjusted earnings of $1.06 to $1.07 per share versus an estimate of $1.05 per share. Revenue is expected to be in a range of $1.051 billion to $1.053 billion versus the estimate of $1.02 billion.

Zoom Video was down 17.42% at $200.08 at press time.

See Also: Why Zoom Video Shares Are Sliding Today

Zoom Video Daily Chart Analysis

• The stock fell closer to support in what technical traders call a downward channel pattern. The stock is showing it has been in a long-term downtrend and may continue if unable to break above resistance.
• Connecting the highs shows the downtrend the stock has been in. Taking a parallel line and connecting it to the lows shows the channel the stock has been trading in. These areas may continue to hold as support and resistance in the future until one of the levels is broken.
• The stock trades below both the 50-day moving average (green) and the 200-day moving average (blue), indicating the stock is likely facing a period of bearish sentiment.
• Each of these moving averages may hold as a potential area of resistance in the future.
• The Relative Strength Index (RSI) saw a strong downward push and now sits at 19, pushing well into the oversold area. This shows the stock saw a large amount of sellers enter the stock and that the selling pressure heavily outweighs the buying pressure.

What’s Next For Zoom Video?

Bullish traders want to see the stock begin to form higher lows and push toward the resistance level. If the stock can break above the resistance level, it could confirm the trend has changed and an uptrend might start.

Bearish traders want to see the stock continue to trade below the pattern resistance. Bears are in full control of the stock and would like to see it stay below resistance and the moving averages to maintain control of the stock.