Delta Air Lines
Delta Air Lines (DAL) stock lost more than 3.5% today as the company continues to struggle with the aftermath of the Global IT outage caused by CrowdStrike’s software.
The commercial airline operator has been the most effected by the outage with more than 5,500 flight cancellations having been reported so far.
Earlier this month, Delta released earnings that missed analysts’ expectations, sending the stock to a recent low of $42.50. The company also released forward-looking guidance that was lower than Wall Street’s forecasts.
Today’s move lower puts the stock back within reach of those recent lows, along with the stocks 200-day moving average.
A break below that combination of price and technical trendline would steer prices lower towards a target price of $25 as the long-term trends turn bearish on Delta and other airline stocks.
On a sidenote, Delta was included in a bearishly biased article over the weekend in Barron’s as the industry is beginning to forecast a broad slowdown for airline travel.
NVIDIA
NVIDIA (NVDA) and the rest of the semiconductor sector responded to last week’s selling pressure as the stock added 4.75% to its value today.
This morning’s headlines included news that NVIDIA is working on a specific line of semiconductor chips would not be subject to export restrictions with China.
The company’s announcement sparked Citigroup to add the stock to its “30-day Positive Catalyst Watch list” with more than a month to go before the company announces iits current quarter’s earnings results.
NVIDIA shares are still trading between two critical trendlines that will ultimately determine the next short-term 10-20% move in the stock.
NVIDIA stock’s 20-day moving average sits less than 2% above today’s closing prices. This short-term directional trade of the stock. The 20-day moving average shifted into a bearish trend last week as the stock broke below $120.
A break above the 20-day moving average will start to attract more short-term traders as buyers of NVIDIA ahead of the company’s earnings report next month.
Approximately 5% below today’s closing price sits the 50-day moving average for the stock.
This trendline is among the most widely watched trends on Wall Street, meaning that a break below it will increase selling pressure on the stock.
NVIDIA stock has not traded below its 50-day moving average since April 2024.
A break below NVIDIA’s 50-day moving average would target a fast and aggressive selloff of the stock to $100 which would draw significant buying interest ahead of the company’s earnings report.
CrowdStrike
CrowdStrike (CRWD) shares continued to see selling pressure in the wake of one of the largest IT outages in history.
Shares of the Austin Texas based cybersecurity technology company are now trading 34% lower than last week’s highs after Friday’s global internet outage impacted computers running Microsoft operating systems. Banks, hospitals and airlines were among the businesses worst-hit, with some still struggling to fully restore their systems
As of this morning, the company commented that it “continues to focus on restoring all systems as soon as possible. Of the approximately 8.5 million Windows devices that were impacted, a significant number are back online and operational”
Today’s selling was fanned by several Wall Street analysts downgrades of the stock, including the lowering of their price targets.
From a technical perspective, CrowdStrike’s stock broke through its 200-day moving average this morning, adding to the selling pressure. This long-term technical trendline acted as support on Friday as investors started buying the recent dip in shares prices.
From a longer-term perspective, CrowdStrike shares are still trading in a bull market trend with their 20-motnh moving average – the line of demarcation between a bull and bear market trend – hovering at $213, about 13% below today’s closing price.
Investors should expect to see the stock attract buyers at the psychologically significant $250 price point.
