Fox stock is trading near a historically bullish trendline
After touching a record high of $58.74 on March 3, the shares of media giant Fox Corp Class A (NASDAQ:FOXA) quickly pulled back following news that they expect subscriber numbers for its upcoming streaming services to land in the mid-single-digit millions range. Since the start of March, FOXA has shed 9.4%, but historical data suggests the stock may be poised for a rebound.
According to a study from Schaeffer's Senior Quantitative Analyst Rocky White, Fox stock is now within one standard deviation of its 50-day moving average. The stock has traded above this trendline 80% of the time over the past two months and in eight of the last 10 trading days.
Per White's data, similar pullbacks have historically led to strong short-term upside, with past instances resulting in an average one-month gain of 11% and an 80% win rate. A comparable move from FOXA’s current perch of $52.32 would place the stock at $58.08, within reach of a fresh record peak.
Adding to this setup, the equity’s 14-day relative strength index (RSI) of 23 signals oversold conditions -- a contrarian indicator that suggests significant upside potential.
Short sellers have been backing off, with short interest down 12.4% in the last two reporting periods. However, the 21.46 million shares sold short still account for 10% of Fox stock’s available float, meaning a short squeeze remains a possibility. Analysts also remain cautious, with 12 of 20 firms maintaining a "hold" rating, leaving room for potential upgrades to fuel further gains.
Options traders have also leaned bearish, and an unwinding of this pessimism could serve as an additional bullish catalyst. FOXA’s 50-day put/call volume ratio at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) ranks in the 80th percentile of its annual range, suggesting heavy put buying that could unwind, should sentiment shift.