$AVID Still a buy, here's why:Over the last 4 quarters AVID has beat EPS estimates every single time. AVID shares have added about 130%+ since the beginning of this year and quarterly revenue was up by 20 million more than estimated. The main reason for the recent sell off was the slowing of subscription based plans that were up massively in the first quarter of this year. This was expected, as more people were exposed to the audio and video company's services during work at home based projects that boomed during the 2020 pandemic quarantine than they are now.
Back to the chart, it seems clear that there is a decent level of supply between the .236 and .382 retracement levels that coincide with the 200 day MA. It is also important to note that the day after the ER, the stock used the first anchored VWAP from February as support and has held that level for now. Below the AVWAP, a further retracement to the previously mentioned levels might be imminent. Like many tech-related stocks with big demand gaps above after earnings, I don't expect that gap above the .618 to fill quickly, or at all. I am willing to play the patient game and buy more shares near the 200d MA if those levels are reached.
Protools
$AVID consolidation and pre-earnings plan.Today was the first time in a long time (probably 2 months ago), as reported by @Fredbenz0 , that AVID caught some unusual action on the 35c expiring August 20th. Even though it seems like the OI flipped on these 200 sized blocks, the bullish action is not far away from what this long set-up is about to give us. It seems that a period of consolidation will follow this explosive move after a year long rally that culminated in a strong 2.618 target from this year's first quarter. That same fib is also a massive resistance level set back in 2008 when support broke and led to lower prices. Looking at our indicators, we can see that since March 2020 lows, AVID has held the 8 and 13 EMA strongly. Our Average directional movement is also showing a much weaker trend than before, similar to what happened earlier this year. Based on supply below, it wouldn't surprise me if price led lower towards that 31 and 34 dollar area, where buyers could be found. If that is the case, and if previous support holds, this would make another great add and long anticipating another blowout ER since their previous one. If price find this area before earnings, I will hold off and wait until after earnings. If ER takes us lower, I will be a buyer again.
$AVID Approaching important yearly resistanceAVID continued it's trend higher today putting in a higher high in the last 52 weeks, fast approaching an important level put in years ago. The 1.618 fib level matches that level of resistance and should slow down once it reached that target, allowing indicators to cool off. The second important level above is 48. I would like to see those lower 30s hold in order to push higher and consolidate in this price range before melting up. Notice how the range inside the box before built up enough strength for a move higher. Ideally that is what I'd like to see, and I plan on buying any dips in the lower 30s.
Despite the recent sells by insiders, on 6/9 was the first time in a long time I've seen call flows in an aggressive ITM 20c position.
