Lululemon Athletica (LULU.US) is taking a dive in today's session following negative news about its projected results for the fiscal fourth quarter. The company's CEO, Mr. Calvin McDonald, communicated that despite a good start to the holiday season, the results were inflated by significant increases in sickness in the US as well as staffing issues and reduced shop hours.
The sportswear company said in a release that it expects Q4 results to be near the low end of its expected range of $2.125 billion to $2.165 billion. EPS is expected to reach the lower bound of the range (3.25-3.32 earnings per share). The company is also facing a lawsuit from Nike Inc (NKE.US) over patent infringement. The company was losing more than 7% before the start of the session on Wall Street.
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Looking at the chart of Lululemon Athletica (LULU.US), we can see that today's trading started from a downward price gap, which range exceeded the 61.8% Fibo retracement. The nearest support now remains the 78.6% Fibo retracement, close to $315 per share. The levels of Friday's close are the nearest resistance zone (near $352 per share). Source: xStation 5
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