Watch SoFi as it enters the oversold region although stock is bearish

0
By:

Motiur Rahman

on
Apr 26, 2022

SoFi stock is down 27% in a month.

Stock weaknesses have been accelerated by downgraded FY22 guidance.

SoFi is currently at the oversold level ahead of earnings in May.

SoFi Technologies Inc. (BMV:SOFI) is a stock that has been under pressure. The stock has lost more than 27% in a month, with the current level significantly lower than its IPO price. The stock weakness was heightened by a downgrade in FY22 forecast by the company.

On April 7, SoFi said it expected a revenue of $1.47 billion FY22, down from the previously guided $1.57 billion. The company referred to President Joe Biden’s directive to extend student loan repayment in the downgrade. Still, SoFi maintained that it would hit a previous revenue guidance of $280 million to $285 million in Q1 2022.


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Eyes now turn to SoFi’s quarter results, which come on May 10. Zacks Investment Research has earmarked an EPS of -0.14, compared to an EPS of -0.15 in the fourth quarter of 2021. With the stock pricing in a lower guidance, attention will turn to whether the earnings will beat forecasts.

SoFi technical analysis 

Source – TradingView

Technical analysis shows that SoFi stock is in a strong bearish market. The RSI of 31 suggests the stock is oversold. This signals a potential bullish reversal. However, with no bullish price signal, we remain cautious about the stock. Investors should wait for some price consolidation and bullish price signals before buying. A strong quarter results next month could offer a trigger for a bullish reversal.

Summary

SoFi stock is yet to hit a buy trigger as it remains bearish despite reaching the oversold level. Investors should wait for bullish reversal signals before buying. The quarter results next month will also help determine the next course of the stock.

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