Despite mostly positive headlines so far in 2017, Fitbit Inc FIT 1.41%shares just can’t seem to gain any traction in the market.
This week, Fitbit announced a three-year partnership with the NBA’s Minnesota Timberwolves. Fitbit will provide the Timberwolves, the Minnesota Lynx and the Iowa Wolves with fitness devices, and special Fitbit advertising patches will appear on Timberwolves jerseys starting next season.
Fitbit shares barely reacted to the news, trading flat near all-time lows on Wednesday.
Even a big Q1 earnings beat couldn’t trigger lasting gains in the stock. Fitbit shares initially jumped as high as $6.80 in early May following the strong first-quarter numbers, but sellers quickly jumped at the opportunity to dump shares at higher prices.
Even a lone insider purchase of 25,000 shares by director Christopher Paisley amid a wave of insider selling in the past year barely moved Fitbit’s stock.
As it stands, Fitbit is once again knocking on the door of a critical technical and psychological support level at $5.
Fitbit bounced off the $5 level in late May and has so far managed to stay above it this week despite flirting with $5 for several days now. The $5 level has long been considered a very important support level for all stocks. In addition to investors not wanting to own sub-$5 stocks in their portfolios, some institutional investors are prohibited from owning stocks priced under $5 at all.
If Fitbit fails to hold the $5 level, potential forced institutional selling, brand new all-time lows, and a lack of technical support below could be…
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