Adobe - shares are down over 11% in pre-market after weaker Q2 guidance

Taking a look at Adobe after it reported its earnings yesterday. The tech company reported earnings above analysts’ expectations, the EPS came in at $4.48 on revenue of $5.18bn. However, Adobe forecast second-quarter revenue below analyst expectations due to increased competition and weaker demand. As a result, its share price is now down over 11% in pre-market trade. Nevertheless, the company has announced a $25 billion share buyback programme, which should help maintain its share price in the longer-term. From a technical standpoint, the stock will open today with the price below the supportive trendline, which was acting as the key support here. The selling and buying volatility should be high for the next couple of trading days while the stock tries to determine the course of the direction for the near future. However, with the share buyback programme, we could see the buyers scoop some of these losses at the open. The key support here now will be the level of $498.83 with the resistance at $506.94, which was one of the previous support levels now acting as resistance. The technical indicators will now most likely turn negative for the near term and until there are signs of consolidation.