Airbnb (NASDAQ: ABNB) stock price has dropped to fresh monthly lows after the release of its latest earnings report. Even though the Q1 financials beat the analyst estimates, it was still not enough to create new buying pressure. Our analysis reveals that the stock price may have a significant bounce from its current level.
After a bullish start to the week, Airbnb stock had a major gap down opening on Wednesday. There are fundamental reasons behind this massive sell-off which we’ll be discussing below. The negative price action comes at a time when most tech stocks are trading at their weekly highs.
NASDAQ: ABNB Remains Unfazed By CPI Report
The inflation data for April 2023 was revealed in the CPI report today. According to the report, inflation rose by 4.9% on a YoY basis last month. This was also the lowest rise in inflation since April 2022. The markets reacted very positively to the news as the S&P 500 and the Nasdaq 100 index opened higher.
The rise in S&P 500 index faded in the first couple of hours of trading, but the Nasdaq index continued trading at its yearly highs. However, Airbnb stock price remained showed no reaction to the major news, and the stock remained 12% down from its yesterday’s closing. It is worth mentioning here that the core inflation rose by 0.4% in April, which was above the analyst estimate of 0.3%.
Airbnb Stock Price Hangs By A Thread
Technical analysis of NASDAQ: ABNB reveals a few key levels on its chart that the price may respect in the near term. The most critical level on the chart is the $126 level which is a major resistance on the daily timeframe. This level has resulted in multiple rejections in the past six months.
A reclaim of this level can make Airbnb stock price forecast very bullish. On the other hand, a breakdown below the 200 MA may take the price to its new yearly lows. Right now, the price is retesting the 200 MA, which lies at $110.6 on its daily chart.
I’ll keep sharing my updated outlook on Airbnb stock in my free Telegram group, which you’re welcome to join.