The next earnings report for GoPro (NASDAQ:GPRO) is scheduled for Feb. 5 after the market closes. Today we’ll take a fresh look at the struggling manufacturer of action cameras to identify the trends and price levels that matter right now. Spoiler alert, GoPro stock isn’t pretty.
GPRO is the definition of a dead money stock. For years it’s been a graveyard where greenbacks go to die. There have been isolated incidents of hope and rumors of resurrection along the way, but they’ve all proven hollow. Every time bottom fishers find reason to purchase, the cold reality of deteriorating fundamentals and underwhelming sales arrives to send them slip-sliding away.
The all-time low of $3.25 touched last October beckons, and I see few reasons why GoPro won’t heed its prompting.
GoPro Stock Charts
The weekly chart chronicles GoPro’s twists and turns as a public company. What began as a potentially powerful new momentum stock quickly fizzled into a money-stealing deadbeat. For years, GPRO has been trying desperately to regain the magic, but the chart doesn’t lie — it ain’t happening.
From its peak of $93.85, GoPro shares are down 96%. Heading into next week’s report, the stock sits beneath its 200-week, 50-week and 20-week moving averages. The past quarter has seen the stock stall out, lying in wait for the next catalyst. If the chart changes, I will happily inject some positivity into my mood. We would need a break back above $5 before I would entertain anything bullish on the weekly time frame. Color me skeptical. But, there’s your line in the sand if you’re seeking signs of hope.
Here’s a second crack at the weekly view that provides more clarity than the prior one. Because of the massive difference between $100 and $3, the price scale of the first chart makes it challenging to dissect recent price action.
Drilling down to the daily time frame reveals more of the same but in high definition. Despite a rousing six-month shoving match, GoPro stock sits at the same spot as last July. The past quarter has been particularly uneventful, creating a narrow trading range that could provide an interesting breakout trade if next week’s earnings spark some much-needed momentum.
The obvious resistance zone that has to be broken before bull trades have a green light is $4.75. But honestly, it’s close enough to the 200-day moving average that I’d want to see us take that out as well.
On the south side, $3.80 is the price to watch. A breach of that creates a compelling short setup that could push the stock down to $3.25. If GoPro continues to play fiddle-in-the-middle after earnings, go digging for opportunity elsewhere.
As of this writing, Tyler Craig held no 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!