PayPal Stock Slumps Amid Increasing Competition—Important Technical Levels to Monitor

Here is a look at a chart tied to PayPal’s recent news-driven price move, with important technical levels to monitor.

PayPal Holdings, Inc.

Shares of digital payments giant PayPal (PYPL) fell 4.2% Tuesday and were down again ini pre-market trading Wednesday after Mizuho downgraded the company’s stock to “neutral” from “buy”, citing concerns over increasing competition in the payments space. Analysts cautioned that the company’s market share could face challenges from newer payment methods that resonate with younger cohorts, such as Apple Pay and buy now, pay later (BNPY) financing options. The bank also noted that the company falls behind rivals on mobile checkout services and may have profit margins crimped from an over-reliance on its lower-margin unbranded checkout product. In addition, Mizuho lowered its 12-month price target on the stock to $65 from $72.

PayPal shares have oscillated within an orderly descending channel over the past 12 months, helping to establish clear support and resistance areas on the chart. In recent weeks, the price has failed to climb above $65, finding overhead resistance from the channel’s top trendline, which roughly aligns with the 200-day moving average. If the stock continues to fall, monitor how the price responds to pattern’s lower trendline around $47.50.