Zillow Group Inc. (Z) is catching a break on Tuesday after getting hammered Monday when news broke that Alphabet is experimenting with real estate listings appearing directly in Google search.
What Spooked Investors: Over the weekend, social media lit up with screenshots showing for-sale home listings popping up right in Google search results. Not exactly what Zillow wants to see when its entire business model depends on being the go-to destination for home searches.
Global real estate tech strategist Mike DelPrete shared images of Google displaying full property details along with a "request a tour" button positioned above Zillow's own listings when users searched "homes for sale" in certain areas. That's the digital equivalent of someone setting up shop right in front of your store.
DelPrete noted this appears to be a limited mobile test in select markets, but the market didn't wait for confirmation before sending Zillow shares tumbling. Tuesday's uptick looks more like investors catching their breath than any fundamental shift in sentiment.
The Technical Picture: The charts aren't doing Zillow any favors. The stock is trading 3.3% below its 20-day simple moving average at $72.48, suggesting it's struggling to find upward momentum. The RSI sits at 38.69, leaning toward oversold territory but not screaming "buy the dip" quite yet. Meanwhile, the MACD remains below its signal line, reinforcing near-term selling pressure.
Key levels to watch are support at $69.50 and resistance at $74.50. Drop below that support level and things could get uglier. Push above resistance and maybe we're talking about a real reversal.
Here's the kicker: Zillow is currently trading at just 34.7% of its 52-week range, meaning it's much closer to its yearly lows than its highs. That's not exactly a vote of confidence from the market.
Traders should watch those support and resistance levels closely, along with the moving averages, to gauge where this goes next. The technical setup suggests staying cautious until we see clearer bullish signals emerge.
Price Action: Zillow shares were up 2.37% at $70 at the time of publication Tuesday, according to market data.