Peloton Shares Pick Back Up After A Big Red Day: What's Next?

Peloton Interactive Inc. PTON shares are trading higher Friday, bouncing back after the stock plunged on reports the company planned to temporarily halt production of some of its products as a result of waning consumer demand. Peloton still trades far below a level it once was able to hold as support.

Peloton is up 15% at $27.94 at publication time.

See Also: Peloton Analyst Cuts Price Target By 45% Following Latest Sell-Off

Peloton Interactive Daily Chart Analysis

• After seeing a large gap below support, the stock has been on a downward trend. The stock was able to bounce back and gain some ground after seeing a large dip Thursday.
• If the stock can begin to form higher lows, it may find a strong area of resistance near $80 in the future.
• The stock trades below both the 50-day moving average (green) and the 200-day moving average (blue). This indicates bearish sentiment, and each of these moving averages may hold as an area of resistance in the future.
• The Relative Strength Index (RSI) has started to come back as it has made higher lows since mid-November although the stock still remains flooded with sellers. The RSI sits at 36 and is showing that buyers have begun to start entering the stock.

What’s Next For Peloton Interactive?

Peloton could start to bounce back if more buyers begin to enter the stock and the RSI can get back above the middle line.

Bullish traders want the RSI to start climbing and for the stock to start forming higher lows. Bulls would then like to see a cross above the moving averages and above the $80 level in the future. Bears are in control of the stock and want it to keep falling lower and be able to hold below the moving averages.