Airbnb Stock is Running Into Layered Technical Resistance
A key trendline just rejected ABNB's recent rally attempt
The shares have sold off sharply
After an unsuccessful retest of 2020 and 2021 support at the $130 level last month, Airbnb Inc (NASDAQ:ABNB) has sold off sharply. Since its addition to the Nasdaq-100 Index (NDX) in late 2021, the shares have consistently disappointed, currently down roughly 35% year-to-date. More recently, ABNB hit resistance at its 50-day moving average and $115 level – from which the shares broke down below a trendline connecting higher lows since its June bottom.
This week, the stock price peaked just below its early-August earnings close. Shorts have been building their positions since late April, and are likely to use rallies to build more positions as they are profitable and have no urgency to cover.
Recent peak OI at the $115 is the site of the first strike where call OI is higher than put OI for all options expiring through October. Put OI is stacked down below the 90 strike and could act as short-term magnets on additional weakness.
Meanwhile, analysts’ 12-month consensus price target of $140.43 is a roughly 30% premium to current levels. Our recommended put has a leverage ratio of 3.9, and will double in value on a 20.8% drop in the underlying equity.
Subscribers to Schaeffer's Weekend Trader options recommendation service received this ABNB commentary on Sunday night, along with a detailed options trade recommendation -- including complete entry and exit parameters. Learn more about why Weekend Trader is one of our most popular options trading services.
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