The best days for TripAdvisor (NASDAQ:TRIP) have come and gone. So says its price chart which confirms the once high-flying travel services company has been dragged deep into the bears’ den with few chances for escape. TRIP stock is flirting with 52-week lows, and unless something changes quick, all-time lows are on the horizon.
On that note, I will examine TRIP’s stock chart from all angles to identify the trends and price levels that should define your bias moving forward.
Weekly Time Frame
Right out of the gate, TripAdvisor found itself a bullish following. In the 18 months following its late-2011 IPO, its shares rose five-fold. Earnings growth looked promising, and optimistic investors were willing to pay up for a piece of the action. Unfortunately, disappointment set in after a spate of quarterly reports failed to justify the lofty share price.
Fast forward to 2020, and after a thorough dismantling of all that was gained, TRIP stock has come within a few bucks of where it began. It’s been a volatile ride with dreams dashed and bulls bashed, and the worst part of the demise is that it occurred during an epic bull market. I’m not even going to run the numbers on how poorly TRIP has fared versus the S&P 500. Trust me — it’s terrible.
So what now?
The short answer is to steer clear. The weekly trend gives no reason for buyers to get involved. It’s trending lower beneath all major moving averages with an uninterrupted series of lower lows and lower highs. We’ve seen multiple bounce attempts over the past year, but every time a spark of hope forms, underwhelming earnings reports arrive to snuff it out.
Turning to support and resistance levels reveals the next ceiling looms near $33, while a floor sits at $27. TRIP stock has risen for eight weeks in a row, but all it’s done is create a potential bear retracement pattern, or a lower-risk entry to launch short trades from. I wouldn’t entertain any bullish ideas unless we see resistance fail and a bona fide reversal form. Perhaps the next earnings report will be the catalyst. Color me skeptical.
TRIP Stock’s Daily Time Frame
We can view the gory details of TripAdvisor’s decline in greater clarity on the daily time frame. Though we’ve seen multiple attempts to climb back above the 50-day moving average, each has proven feeble and fleeting. Spectators hoping that this week’s rise above the 50-day will prove different should hold their optimism in check. We’ve seen this movie before, and it always ends in tears.
Until we see a positive response to earnings — some kind of upside surprise to shock bears and spark an uptrend — I see no reason to bottom fish here. Mark your calendar for Feb. 13. That’s the date of the next report and will be the critical driver for TRIP’s direction over the next three months.
The best trade here is no trade.
As of this writing, Tyler Craig didn’t hold positions in any of the aforementioned securities. For a free trial to the best trading community on the planet and Tyler’s current home, click here!
