:max_bytes(150000):strip_icc()/EXPEChart-7aa2a5b06eda421896153124382ebaa3.gif "Watch these Expedia price levels as the stock rises after beating earnings estimates")
Key findings
- Expedia Group shares traded sharply higher before the market opened on Friday after the online travel company’s earnings beat estimates amid robust demand in international markets.
- An earnings-led rally may lead the stock to form a double bottom given the proximity of the May and August lows.
- If the stock moves higher, investors should keep an eye on Expedia’s key share price levels at $130, $140 and $155.
Expedia Group (EXPE) shares rose sharply before the market opened on Friday after the online travel company reported earnings that beat estimates amid robust demand in international markets. However, the company warned of a tougher macroeconomic environment and slowing travel demand in July, in line with its peers’ expectations.
This month, Booking Holdings (BKNG), TripAdvisor (TRIP) and short-term rental company Airbnb (ABNB) warned of a slowdown in U.S. travel demand, but attributed the slowdown to a normalization of trends after a post-pandemic boom. During Expedia’s earnings call, CEO Ariane Gorin told analysts that the travel site continues to gain strength internationally, which could potentially help boost shares in premarket trading.
About two hours before the market opened, Expedia shares rose 9.7% to $129.40.
Below, we analyze Expedia’s share price movement in the chart and point out important levels to watch out for given the travel giant’s surge following the release of its earnings figures.
Possible raised floor
After an ominous death cross pattern appeared on Expedia’s chart in late May, shares initially bucked the downtrend and staged a six-week countertrend rally above the 200-day moving average before giving up most of those gains in the final weeks ahead of the company’s quarterly earnings release.
However, better-than-expected earnings suggest the stock will rise again and may form a double bottom given its proximity to the May and August lows.
Interesting price levels after the earnings announcement
Given Expedia’s share price surge following the earnings release, it’s worth keeping an eye on three key price levels.
The first level is at $130, an area on the chart where the stock could face resistance from above, from a trendline that connects several pre- and post-gap trading levels with several price moves between February and July. This level is also close to the 200-day MA, an indicator that has been applying selling pressure since late June.
Further buying could lead to a move up to the $140 area, where shares could face resistance from a horizontal line connecting several local peaks between December and April to the striking swing high in July. Interestingly, this area also roughly corresponds to a price target in the form of a bar pattern that picks up the stock’s uptrend from late May to mid-July and positions it off that month’s low.
Finally, a sustained uptrend could lead to a move to $155, where the price would likely face resistance near three minor tops that formed on the chart between December and January.
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At the time of writing, the author does not own any of the securities mentioned above.
