Affirm Looks Weak Ahead of Earnings

In our August 26 review of Affirm (AFRM) we wrote that “The charts and indicators of AFRM are weak and traders should avoid the long side for now. Maybe later…”

With AFRM scheduled to report their latest quarterly numbers after the close of trading Tuesday let’s check the charts again.

In this daily bar chart of AFRM, below, we can see that prices have been weak since our late August review. AFRM is still in a downward trend and trades below the declining 50-day moving average line and below the bearish 200-day line.

The On-Balance-Volume (OBV) line is in a decline and tells us that sellers of AFRM have been more aggressive with heavier trading volume being transacted on days when AFRM has closed lower.

The Moving Average Convergence Divergence (MACD) oscillator is bearish. 

In this weekly Japanese candlestick chart of AFRM, below, we can see a bearish picture. Prices remain in a longer-term downward trend as they trade below the bearish 40-week moving average line. The weekly OBV line is pointed down and the MACD oscillator is below the zero line in sell territory. 

In this daily Point and Figure chart of AFRM, below, we can see a potential downside price target in the $9 area.

Bottom line strategy: I have no special knowledge of what AFRM will be telling shareholders and Wall Street analysts but the charts are weak and traders should continue to avoid the long side of AFRM.