Zoom Stock Rally Faces Resistance As Q1 Earnings Loom - Breakout Or Fade Ahead?

Zoom Communications Inc. ZM is set to report its first-quarter earnings after the market closes Wednesday, with Wall Street expecting earnings per share of $1.31 and revenue of $1.17 billion.

The stock has climbed 17.5% in the past month, is up 1.5% year to date, but still down 29.7% over the past year. As investors await results, the technical setup for the stock suggests the recent rally may still have room to run – though caution is warranted.

Read Also: Zoom Likely To Report Lower Q1 Earnings; These Most Accurate Analysts Revise Forecasts Ahead Of Earnings Call

Zoom Stock Bullish Ahead Of Q1 Earnings

Chart created using Benzinga Pro

Technically, Zoom's eight-day simple moving average (SMA) is at $83.36, slightly above its current share price of $82.87, flashing a short-term bearish signal. However, longer-term indicators tilt bullish: the 20-day SMA is $80.08, the 50-day SMA is $76.00 and the 200-day SMA sits at $75.73 – all below the current price and indicating sustained momentum.

The Moving Average Convergence Divergence (MACD) reading stands at 2.43, suggesting a bullish bias, while the Relative Strength Index (RSI) is at 66.55 – just shy of the overbought zone, indicating strong buying interest without tipping into excessive exuberance.

Zoom Analysts See 7% Upside

On the street, analysts remain cautious. The consensus rating is Neutral with a price target of $84.14. The three most recent analyst calls—from Benchmark, Scotiabank and Citigroup—set an average target of $88.67, implying only a modest 6.88% upside from current levels.

As earnings loom, Zoom's chart suggests bullish momentum with a side of skepticism. A beat on revenue or guidance could ignite further upside—but any missteps might mute the enthusiasm fast.

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