Adobe
Adobe (ADBE) shares fell more than 4% before the market opened on Thursday after the multimedia software company provided earnings guidance for 2024 that fell short of Wall Street expectations. While the company reported a 26% increase in net income for the fourth quarter, it expects earnings per share in 2024 to be between $17.60 and $18 on revenues ranging from $21.3 billion to $21.5 billion, while analysts had expected earnings per share of $18 and revenues of $21.73 billion.
The price of ADBE stock has steadily increased since May, with only two minor dips below the 50-day moving average. In the event of an earnings decline, investors should watch the key support level at $570 – an area on the chart that finds a resistance crossover from two nearby highs and the 50-day moving average. Long-term, the $700 level should also be monitored, as the stock may face resistance from its all-time high.
Etzy
Etzy (ETSY) shares fell 2.2% on Wednesday after the e-commerce company announced it would be laying off 11% of its workforce. The company stated that the job cuts, which will affect about 225 employees, are part of a restructuring plan to streamline costs in a very challenging competitive environment. CEO Josh Silverman noted that employee expenses have risen while the company’s gross merchandise sales remained flat, describing this as unsustainable.
In the fourth quarter, Etzy expects gross merchandise sales to contract between 1% and 2% compared to the same quarter last year. However, the company has revised its EBITDA profit margin guidance for the period to be between 27% and 28%, up from a previous guidance of 26% to 27%. It also expects revenue growth of between 2% and 3%.
ETSY shares dropped by as much as 8.5% before they managed to modestly recover during the session on heavy trading volume, closing near the 200-day moving average. Although not confirmed, the stock may be carving out a double bottom pattern, a chart formation that typically occurs at the bottom of a downtrend and indicates a bullish reversal. Investors should monitor the critical level at $100 where sellers may intervene near a trendline connecting the lower highs in March and the upper high in July.
SPDR S&P Regional Banking ETF
The SPDR S&P Regional Banking ETF (KRE), which holds a portfolio of over 100 regional bank stocks, added 5.9% on Thursday after the Federal Reserve issued a more dovish outlook on interest rate direction for next year at its December meeting.
Multiple rate cuts in 2024 can aid regional banks’ profitability by increasing demand for loans as economic conditions improve. Lower borrowing costs will also relieve pressure on banks’ net interest income that has arisen from the ongoing competition among the sector to attract customer deposits. Regional banks have performed poorly this year due to the failures of several leading industry names including Silicon Valley Bank, Signature Bank, and First Republic Bank.
Since KRE set its low in late October, KRE stocks have continued to gain momentum, although trading volume has been somewhat irregular. In a win for the bulls, the price closed above an important high from July on Wednesday, coinciding with the 50-day moving average preparing to cross back above the 200-day moving average and generating a golden crossover buy signal. If the price of the fund rises from here, watch the $57 level where it may face resistance from a horizontal trendline connecting two major lows on the chart over the past 18 months.
Source:
https://www.investopedia.com/3-charts-for-investors-to-watch-thursday-adobe-etsy-kre-etf-8415850
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