Zoom Hits Our First Downside Target ... What's Next?
by Mike Paulenoff
October 31, 2020 • 12:00 AM EDT
This past Tuesday afternoon, with Zoom Video Communications (ZM) at $539.50, Mike Paulenoff told MPTrader members:
"ZM followed a very technical price path into its October high at 588.54, which my work argues ended the up-leg from the August low at 230.75...The $64,000 question for me is whether or not ZM's correction will be completed in the 460-480 support zone, or slice through it towards 350-370? We will find out soon enough as we look for signals of downside exhaustion as ZM approaches the first downside support zone."
Starting the very next session (on Wednesday), ZM pivoted to the downside into a relentless decline, hitting a new reaction low at $457.02 late on Friday, prior to closing for the week at 460.91.
ZM's 15% ($82.48) plunge satisfied Mike's first downside target zone.
What's next for ZM? Is its recent weak price action merely a correction -- and a buying opportunity -- in a global pandemic that is experiencing a resurgence?
Or does the weakness reflect a potential shift in investor perceptions about the ability of the company to continue to benefit within a prolonged pandemic-challenged business environment?
Join Mike and his MPTrader community for their forthcoming analyses and discussions about ZM, in addition to many other stocks, ETFs, and indices.
Mike Paulenoff is the author of MPTrader.com, a real-time diary of his technical analysis & trade alerts on
ETFs for precious metals, energy, currencies, and an array of equity indices and sectors, including international
markets, plus key ETF component stocks in sectors like technology, mining, and banking.
Sign up for a Free 7-day Trial!
More Top Calls From Mike
Eight weeks ago, Mike Paulenoff discussed the budding technical setup and upside breakout in CRWD (CrowdStrike Holdings) with our MPTraders members, writing:"CRWD has followed the bullish scenario we discussed in late August, and in fact, today (10/06/23) has thrust above 5 months of resistance to new recovery high territory at 176.32. Although my next optimal upside target zone is 190-200, the BIG picture setup points to 230-240 thereafter... Last is 174.86...
On Monday morning, November 13, 2023, a full 5 trading sessions before the approaching November Options Expiration (OPEX) (11/17/23), I posted my chart-based commentary for our members:SPY-- Considering that Friday is November Option Expiration, where are the "magnetized strike prices" as we start OPEX week? Based on my attached Hourly Chart, the magnetized strike price zone spans from 436 to 441. Should SPY take out the upside barrier of 441, then the follow-through outlier magnetized target could be as high as 450 before or on Friday.
On October 23, 2023, ten days before the November 1st FOMC meeting and policy statement, I posted the following commentary about the downward-spiraling TLT (20+ year T-bond ETF):My attached 4-hour Chart of TLT shows that the relentless and near-vertical downtrend that commenced at the beginning of August from around 100 hit a new long-term low at 81.92 this AM, positioning it in my intermediate-term optimal downside target zone from 80 to 82.
On the afternoon of September 25, Mike Paulenoff posted a warning signal to MPTraders members about the developing acute oversold condition in RTX (formerly Raytheon Technologies), writing:"RTX (formerly Raytheon Technologies) hit a new multi-month corrective low of 71.02, down 33% from the 4/10/23 post-pandemic High at 106.02. Although RTX has violated my optimal target window of 73-75, the stair-step corrective pattern off of the 4/19/23 high at 104.
On October 3, Mike Paulenoff posted the following "Heads Up!" about GLD (SPDR Gold Trust, ETF) for MPTrader members: "GLD has pressed to an important technical inflection window from 169.50 down to 166.30, from where I will be expecting corrective downside exhaustion off of the 5/04/23 high at 191.36, and new buying interest. From a nearer-term perspective, given the acute oversold but CONFIRMED Momentum reading of 17.16 an hour ago, my preferred scenario argues for another loop down that marginally violates today's low at 168.
