Analyzing COVID corrections PTON, ZM & DOCU

In researching coming earnings plays I decided to look at possible correlations between the drops experienced by stocks inflated by COVID and seemingly have found one:

ZM drop to May 2020 valuation

DOCU drop to May 2020 valuation

PTON drop to May 2020 valuation

Above are PTON, DOCU & ZM. All three make up the “notable” COVID corrections and they all seem to have fallen to their May 2020 valuation. The cause of this is probably … as with all things … algos. I’d figure that when the selloffs are triggered, algo/institutional buy orders are likely congregating at this historical point of valuation. If we apply this level to CHWY, LULU & RH we get the following:

CHWY potential drop to $50, a 19% drop.

RH potential drop to $240, a 55% drop.

LULU potential drop to $235, a 45% drop.

Keep in mind this is very much “idiot science”, but there may be something to it.


awesome find, thanks conq.


Seems like a worthy small gamble with how correlated those ones were


Also, as discussed briefly in discord. Something of note here is that these companies are all significantly overvalued currently. While they are possibly still great companies that are doing well, that honestly isn’t going to matter in all likelihood as every one of these was already inflated at the points we’re looking for them to fall to.

LULU for example ran from $200 to $240 in the months leading up to the COVID drop in April 2020, an increase of 20%.
RH $170 to $255, increase of 50%.
CHWY from $29 to $50, increase of 72%.

It’s reasonable to assume that current growth may already be priced in at these levels and the valuation coming off was simply based on potentials of the pandemic.


I found another correlation with a company that popped with COVID, TDOC. Teledoc beat earnings and and Revenue, and fell after earnings. It went back to its May 2020 level, so maybe idiot science has some merit to it.


Really appreciate this! Interesting how strong this correlation is looking.


I’m not sure how this factors in to upcoming guidance, but may be of note.


This looks interesting. Add it into Conq’s post here : RH - The largest of the COVID pumps with impending earnings

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I found that there are similarities in support levels of DOCU and RH. The black line is the starting point of Nov 02 at 10:00 AM

EDIT: If you look at squeeze indicator, there are similarities as well


To add on top of the former correlations. CHWY and LULU do have correlation here. Since they are in the same boat of the COVID-inflated stocks, I assume that they will act accordingly and in similar way. I may be absolutely wrong, too. Lastly, below is ZM chart, which looks close to DOCU with regards to support levels. Take it or leave it !

This is either the greatest coincidence ever, or sheer genius!

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CRWD was another loser, had earnings the other day and missed pretty bad. It’s high was in the $270s. Currently trading at $195, could be headed back to sub 100.

Crowdstrike Holdings (CRWD) reported 3rd Quarter October 2021 earnings of $0.05 per share on revenue of $380.1 million. The consensus earnings estimate was $0.11 per share on revenue of $363.5 million. The Earnings Whisper number was $0.14 per share. Revenue grew 63.5% on a year-over-year basis.

The company said it expects fourth quarter non-GAAP earnings of $0.19 to $0.21 per share on revenue of $406.5 million to $412.3 million. The current consensus earnings estimate is $0.16 per share on revenue of $399.95 million for the quarter ending January 31, 2022.

Don’t know how useful this is but looks like WSB picked up on the trend. Reddit - Dive into anything

Stitchfix just had a similar reversal to may 2020 stock price. Will post chart when at my terminal.

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On chwy one thing to note is that their price to sales ratio is a a lot more reasonable than lets see a docu

Undeleting this, since it’s still useful to look at. However, there isn’t a general rule here and you need to consider your entries with the overall price action of the underlying. December 6th was a really bad day for put entries, as all your graphs are showing. Not every put would have made money if you bought it two weeks out. Asking you to try it out isn’t being dismissive, you can do something on ToS or look at other historical data to see if what you are proposing is accurate.