Fortinet (FTNT) reported earnings that exceeded expectations and raised its outlook, yet the stock was negatively impacted by indications of slowing product growth and a less optimistic forecast for services.
Following this earnings report, the stock has experienced a technical breakdown, but the decline has brought it closer to significant support levels, particularly the Thursday low of $127.40, which is crucial for swing traders to monitor. This level aligns with the rising 200-day moving average and the anchored VWAP from its 2026 low, suggesting it could attract buyers if the stock dips further.
Investors are advised not to chase the stock above $132 but to consider buying on a dip and retest of the current lows. If the stock does not retest and continues to rise, traders may need to seek other opportunities. The expectation is for a recovery similar to past performance, with a target bounce back to the $155-$160 range.
However, there is a cautionary note regarding the weekly chart, indicating that if the stock breaks below Thursday's low, it could decline further to around $110. Therefore, implementing stop-loss orders is essential to manage risk in this swing trade, which could offer a potential return of 15-20% in the coming weeks