CrowdStrike Tests $412 Support as Options Traders Turn Bullish

CrowdStrike Holdings Inc. (NASDAQ: CRWD) delivered a strong earnings report on Aug. 27. However, that wasn’t enough to slow down the sell-off in CRWD stock. As of Sept. 2, CrowdStrike stock is down 6.7% in the last five days, 7.6% in the last 30 days, and more than 13% in the last three months.

On the one hand, like many technology stocks, CRWD stock looked overvalued heading into earnings, so investors were prepared for the stock to drop on a miss or only a slight beat. That wasn’t the case with CrowdStrike.

The company delivered a strong report in which it indicated its annual recurring revenue (ARR) number won’t fully reflect the success of its customer retention program for several quarters.

That wasn’t enough to interrupt the slide in CRWD stock, which is primarily being driven by overvaluation concerns. However, with the stock’s relative strength indicator coming in around 38, could it be time for buyers to jump back in?

Options Traders Are Making Short-Term Bullish Bets

For now, the bears have the upper hand. However, the options chain for CRWD stock indicates that bulls are making a bullish bet on where the stock may go in the next couple of weeks.

The CrowdStrike options chain for Sept. 19 shows clear signs of bullish positioning. Out-of-the-money call options at strikes just above the current price (e.g., $420, $425, $430) are seeing unusually high volumes and open interest.

At the $430 call strike for Aug. 29, over 3,000 contracts are trading, while open interest also spikes at levels up to $450, indicating many traders expect a short-term rebound.

Implied volatility on these calls is elevated, a classic sign that traders are paying up for upside exposure, often anticipating either a technical bounce or a headline catalyst.

The corresponding put strikes (e.g., $400, $410) also show activity, but the weighting is heavily skewed toward calls, further supporting aggressive bullish sentiment.

Overall, call open interest above the current price dwarfs put activity, and the rapid rise in OTM call volume points to speculative bets on a sharp short-term move higher. This setup strongly supports the idea that bulls are making massive short-term bets on CRWD stock, particularly as it tests a key support zone.

Technical Signals Support a Short-Term Rally

As of this writing, CRWD stock is trading around its 200-day simple moving average (SMA) at around $412. This is after the stock knifed through its 50-day SMA at $459.45 before the earnings report.

However, with the relative strength indicator at 38, CRWD stock is starting to look oversold. However, traders may want to see higher volume and a more committed MACD signal to support a momentum-driven reversal.

If the stock drops below its 200-day SMA, investors will want to look for secondary support around $400. This is a psychologically important level that traders will watch closely.

But if the bulls are right, how high could CRWD stock climb? There appears to be strong resistance around $430 to $440. Beyond that, bulls would face resistance around the 50-day SMA ($459).

Overall, the technical outlook favors caution as CRWD tests major support amid weak trend signals, with swing traders and investors likely waiting for either a breakdown or decisive rebound before repositioning.

Analysts Paint a Mixed Post-Earnings Picture

As of this writing, it’s only been a few days since CrowdStrike's earnings report. In that time, however, nearly two dozen analysts have weighed in on CRWD stock. The outlook is mixed.

Overall sentiment supports the consensus Moderate Buy rating, but price targets are all over the map. Oppenheimer has the most bullish target of $520, and Bernstein has the lowest price target at $343.

In percentage terms, the most bullish forecast is for an upside of approximately 13% from the stock’s consensus price target of $460.10. However, the most bearish number is approximately 31% below the consensus target.

Because analyst targets typically project 12 to 18 months, there’s a wide range of possible outcomes. While the long-term cybersecurity outlook supports holding CRWD as a buy-and-hold, short-term traders may prefer to wait for a confirmed rebound before taking action.

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The article "CrowdStrike Tests $412 Support as Options Traders Turn Bullish" first appeared on MarketBeat.