SoundHound AI, Inc. (NASDAQ: SOUN) is experiencing a turbulent trading session today, with its stock price seeing a significant decline shortly after the market opened. As of 10:39 AM EDT, the stock was trading at 0.60, or -5.59%, for the day.
The provided chart shows that after trading in a relatively stable range during pre-market hours, SOUN faced intense selling pressure at the 9:30 AM market open. The stock gapped down from its previous close of $10.73 and continued to fall steeply, hitting a day’s low of $10.08. Trading volume is notably high at over 13.7 million shares, indicating strong market participation in this downward move.
Key Data Points:
-
Current Price: $10.13
-
Day’s Change: -$0.60 (-5.59%)
Advertisement -
Day’s Range: $10.08 – $10.52
-
Previous Close: $10.73
-
Volume: 13.7M (compared to an average of 30.7M)
Should You Buy or Sell the Stock Today?
Based on the immediate technical picture, the momentum for SOUN is strongly bearish.
-
For Sellers/Short-Term Traders: The sharp, high-volume drop indicates significant selling pressure. The stock is currently trading near its low for the day, and attempts to bounce have been weak so far. For traders looking to exit a position or those considering short-selling, the current trend is downward.
-
For Buyers: Attempting to buy the stock at this moment is what traders call “catching a falling knife,” which is a high-risk strategy. The stock has not yet shown signs of stabilizing or finding a solid support level. Prudent investors looking to enter a position might consider waiting for the price to consolidate or show a clear reversal pattern before buying. While the current price is a significant discount from yesterday’s close, further downside is possible in the short term.
Opinion and Outlook
SoundHound AI (SOUN) is a stock known for its high volatility, as evidenced by its Beta of 2.87, which means it moves with much greater intensity than the overall market. The company operates in the popular but competitive field of artificial intelligence, which makes it a high-risk, high-reward investment.
The current negative Earnings Per Share (EPS) of -0.61 shows the company is not yet profitable, which is common for growth-focused tech companies. However, analysts have a 1-year target estimate of $11.81, suggesting some optimism for its long-term potential.
In conclusion, today’s trading action is decidedly negative. The stock is under significant pressure, and short-term caution is warranted. Long-term investors who believe in SoundHound’s technology might view this as a potential buying opportunity at a lower price, but should be prepared for continued volatility. For today, the path of least resistance appears to be downward until a clear support level is established.
