One Step at a Time with Box

The headlines this morning read that BOX fell hard after earnings despite top and bottom line beats. While it is certainly true that BOX has the look an feel of a "sell the news" move after reporting, it is important to note the context of the chart in order to gain better perspective as to whether the promising tech play with AI exposure is now dead in the water or, instead, setting up for a fresh long opportunity. 

On the updated daily chart, below, BOX is down roughly 9.5% as I write this, indeed a sharp drawdown for current longs. But the overarching breakout over $25 is still holding. BOX was a name we played with Members on the long side several weeks back. The persistent, unflappable strength the stock showed after I sold was surprising and very impressive, though the profit-taking phase eventually sets in. 

And so with this morning's weakness, the selling likely reinforced itself reflexively and is perhaps overdone now. In the coming sessions, as long as bulls defend this breakout prior breakout and the broad market stays afloat, at a minimum, I will be looking at BOX for a new, low risk long entry. In other words, I have yet to see much in the overall chart structure and the latest report to undermine the long-term bullish prospects. 

Elsewhere, the broad market is fighting to shake off concerns about European banking giant DB and some other trade war concerns. Tech and select biotech, alongside steels, are outperforming but patience is still the name of the game with this tape in general.