Market Minute: Carvana (CVNA) Earnings Preview

Few stocks can rival the roller coaster price action of Carvana (CVNA), with the once left-for-dead online used car dealer set to report earnings after today’s closing bell. CVNA shares experienced a nearly +2,700% surge from its IPO in 2017 until its all-time high of 376.83 in Aug., 2021, then a -99% drop that hit its nadir at 3.55 in Dec. 2022, then another explosive +7,200% increase back up to close at 258.81 yesterday. 

Like many other stocks, this already-volatile name saw extra turbulence amid the tariff news-related turmoil that stuck markets early last month. But the technical picture shows that, for the most part, closing prices held on to a supportive zone from about 165 to 175 that marked a previous set of lows from both March and September. From there, price has pushed upward in a rising wedge-type shape, but has not yet filled the prior earnings gap downward that began at 280.20. 

This earnings gap marks one potential resistance site for traders to watch, but the post-gap down high point may also be on the radar for many and comes in near 267.65. From there, the recent highs and the yearly +1 Standard Deviation Channel come in at 292.84 and about 307, respectively. For support, the yearly Linear Regression Line (line of best fit & a notion of fair value) is near 255. Beyond that, an old high point and then subsequent low point lines up with the 21-day Exponential Moving Average near 230.