Yahoo Finance

Key Takeaways

• Airbnb shares moved sharply higher in early trading Friday after the short-term rentals company topped Wall Street’s fourth quarter earnings and revenue expectations amid robust demand across global markets.

• The stock has broken out from a flag pattern this week, a chart pattern that indicates a continuation move higher.

• Investors should watch important overhead areas on Airbnb's chart around $170 and $210, while also following key support levels near $155 and $135.

Airbnb (ABNB) shares moved sharply higher in early trading Friday after the short-term rentals company topped Wall Street’s fourth quarter earnings and revenue expectations amid robust demand across global markets.

Executives said the company’s conversion rates have received a boost from technology upgrades and the introduction of product updates in recent years, adding that the online lodging giant plans to launch a new product offering in May.

Airbnb shares have fallen about 6% over the past year as of Thursday’s close, but trade nearly 30% above their July 2024 low.

Below, we take a closer look at Airbnb’s weekly chart and apply technical analysis to identify important post-earnings price levels worth watching.

Flag Pattern Breakout

Since rallying to key moving averages last November, Airbnb shares have consolidated within a flag, a chart pattern that indicates a continuation move higher.

Indeed, the stock broke out above the pattern’s upper trendline this week, with gains set to accelerate on Friday after the company’s better-than-expected quarterly results. Moreover, the relative strength index (RSI) recently crossed back above the 50 threshold to confirm improving price momentum.

Let’s identify two important overhead areas to watch if the stock tracks higher after earnings and also locate several key support levels worth following during pullbacks.

Important Overhead Areas to Watch

The first overhead area of interest sits around $170. This level may provide resistance near a trendline that connects the prominent March 2024 swing high with a range of similar price levels on the chart between October 2021 and April 2022.

A decisive breakout above this price could trigger a rally to the $210 area. Investors who have bought shares at lower prices may look to lock in profits at this level near the March 2021 countertrend peak, which also closely aligns with the that year's November high.

Key Support Levels to Follow

During dips in the stock, investors should initially follow the $155 level. Retracements to this price point could attract buying interest near the notable July 2023 peak and the top of a brief upswing that formed on the chart about 12 months later.