Zoom Video Isn't Sending Bullish Vibes Ahead of Earnings

The technical signals of the video communications company indicate sellers of its stock have been more aggressive than buyers.

Zoom Video Communications Inc. (ZM) is expected to report its third-quarter results after the close of trading here on Monday. In my Sept. 23 review of ZM I wrote, "In our August 4 review of ZM, we recommended that traders take profits on longs towards $125. I hope that traders booked profits last month. Traders should stand aside from ZM probably through the end of the year." Let's check out the charts again of the video communications company to see what they may be indicating for Zoom  from here. 

In this daily bar chart of ZM, below, we can see that the share price of ZM has declined significantly over the past 12 months. Pieces are in a longer-term decline and trade below the declining 200-day moving average line. The 50-day line has begun to bottom and prices are testing this line from above. The On-Balance-Volume (OBV) line is in a downward trend and tells me that sellers of ZM have been and are more aggressive than buyers. The Moving Average Convergence Divergence (MACD) oscillator is just slightly above the zero line. 

 

 

In this weekly Japanese candlestick chart of ZM, below, we can see the extent of the price decline over more than two years. Prices are below the declining 40-week moving average line. The weekly OBV line is bearish and pointed lower. The MACD oscillator is bearish but improving from its worst reading. 

 

 

 

 

In this daily Point and Figure chart of ZM, below, we can see a potential downside price target in the $72 area. 

 

 

In this weekly Point and Figure chart of ZM, below, we used close-only price data. Here the chart suggests a price target of $108. 

 

 

Bottom line strategy: I have no knowledge of what ZM is going to tell shareholders this evening, but the charts are not bullish at this point in time. I also have no knowledge of what Cathie Wood is buying. 

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