- RH Stock price tumbled 8% on a single day after Berkshire Hathaway sold its stake.
- Berkshire Hathaway exited from the high end home furnishing company.
- RH Stock (NYSE: RH) drops below the 50 day EMA.
RH Stock Price tumbled 8% on a single day after Warren Buffett’s Berkshire Hathaway sold its entire stake. Home furnishing company RH stock price corrected 30% approx from the recent swing high at $350.00 and is approaching toward a 52 week low.
The stock price is trading below the 200 day EMA and also drops below the 50 day EMA showcase downtrend. However, the prices are approaching yearly lows which might act as strong support for the long term investors.
RH Stock price closed the previous session at $241.41 with an intraday decline of -8.77%. The market capitalization stands at $5.32 Billion. RH stock price seems to be quite volatile and tried multiple times to sustains above $320.00. But due to the presence of strong sellers prices get rejected and reversed in a downward direction.
From the past year, the stock is consolidating in the wide range $220.00 to $350.00. On March 29, 2023 NYSE: RH released the quarterly earnings which failed to meet the analyst estimates.
However, the stock prices did not react violently and consolidated in a narrow range. Slowly and steady RH stock rose and managed to climb above the 50 day EMA. Sadly, the recent downfall dragged down the prices and eroded the previous gains.
More selloff possible in RH Stock?
RH Stock Price seems to be in correction mode and no signs of recovery is visible. The broader market index like Dow Jones, Nasdaq, S&P 500 is also at crucial resistance. If the index falls then it may trigger the negative sentiment which might affect the stock prices. If the buyers succeed to defend the $226.00 level then short term pull rebound is possible.
However, Till the price trades below $280.00 it is expected to remain in the bear grip. On the other hand if the price drops below $226 then it might test the yearly lows. The technical analysis suggests RH stock price is in a downtrend and the probability of sharp rebound remains low.
RH Stock: Technical Outlook
RH Stock price formed a bearish engulfing candle on a weekly timeframe which is hurting the sentiment of long term investors. The next quarter earnings are scheduled on June 13, 2023 which may decide the short term trend of the stock. Till then prices might consolidate in the range between $226.00 to $280.00.
The technical indicators like the MACD curve is one way to generate a fresh negative crossover. It indicates bearish momentum may continue and more sell off is possible. The RSI at 40 sloping down denotes weakness and likely to test the oversold territory.
Conclusion
RH Stock price tumbled 8% on a single day after the market came to know that Berkshire Hathaway sold its entire stake. The RH Stock price is approaching a 52 week low which might act as a strong support for long term investors. The technical analysis suggests NYSE: RH stock is in downtrend and probability of sharp rebound is low.
Technical levels
Resistance levels : $280.00 and $300.00
Support levels : $226.00 and $207.00
Disclaimer
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