Peloton Interactive Inc. PTON is trading significantly lower Friday after the company reported worse-than-expected first-quarter EPS and sales results.

Quarterly losses came in at $1.25 per share, missing the analyst consensus estimate of a loss of $1.07. Peloton reported quarterly sales of $805.20 million, missing the analyst consensus estimate of $810.76 million.

Peloton was down 34.08% at $56.73 at press time.

Peloton Daily Chart Analysis

• Shares gapped down huge Friday morning, dropping the stock below what technical traders call a sideways channel shares were previously trading in.
• Support was found near the $80 level in the past, but now this level may hold as an area of resistance. Another area of resistance might be found near the $130 level if the stock can climb back into the channel once again.
• The stock trades below both the 50-day moving average (green) and the 200-day moving average (blue), indicating the stock’s sentiment has been bearish.
• Each of these moving averages may hold as an area of resistance in the future.
• The Relative Strength Index (RSI) saw a huge drop off down to the 20 level. This big drop pushed the stock well into the oversold area where the stock is seeing many more sellers than buyers.

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What’s Next For Peloton?

Bullish traders are hoping the stock will see a bounce back and start to form higher lows once again. Bulls are then looking to see the stock cross back above the $80 level and for it to resume trading within the channel.

Bearish traders saw what they wanted to see and got a large dip under support. Bears are in control and would like to see the stock fade lower. Bears want the stock to remain under the moving averages for sentiment to stay bearish.