TRADE SETUP

Where do we stand fundamentally?

CrowdStrike reported Q1 revenue of $1.103 billion, slightly below analyst estimates of $1.11 billion, but beat EPS expectations with $0.73 per share compared to $0.66 forecasted. Free cash flow was $279 million, exceeding estimates of $275 million, and annual recurring revenue (ARR) reached $4.44 billion, slightly above the $4.42 billion expected. Despite the EPS beat, the stock dropped approximately 7% after hours due to the revenue miss and cautious market sentiment.

CrowdStrike announced a 5% cut to its global workforce (approximately 500 jobs) to improve efficiency through AI, incurring up to $53 million in restructuring costs. This move led to a 5.1% stock drop on May 7, 2025, as investors reacted to the costs and uncertainty about immediate efficiency gains.

CRWD is approaching an upside resistance level of 500, and a break above this resistance is needed for a continuation higher.

For the rally to continue, we need a sustained breakout above 500. I am inclined towards a short-term trade entry, as the overall market sentiment remains fragile, and a recent rejection after the earnings report. A break below 462 is opening a test of the next support 400.

_{I am taking a near-term short-trade entry with a SL above 470 to target 370. You can buy put options as well. If the trade is stopped, reverse it to a long trade entry.}