Bed Bath & Beyond Inc. (BBBY) shares fell more than 8% during Thursday's session after analysts weighed in on its first quarter financial results. Revenue fell 6.5% to $2.57 billion, missing consensus estimates by $10 million, and non-GAAP earnings per share hit 12 cents, beating consensus estimates by four cents per share. Shares moved sharply higher in after-hours trading before falling during Thursday's session.

Goldman Sachs initiated coverage on the stock with a Sell rating and a price target of $11 per share. Analyst Kate McShane believes that weak in-store trends and an over-reliance on coupons as a traffic driver have put pressure on sales and margins. Jefferies analyst Jonathan Matuszewski shared these sentiments and lowered his price target from $17 to $13, adding that he prefers to remain on the sidelines.

With Bed Bath & Beyond stock trading near its multi-year lows, traders are looking for an opportunity for a relief rally, and investors are eyeing signs of a turnaround.

Chart showing the share price performance of Bed Bath & Beyond Inc. (BBBY)

From a technical standpoint, the stock fell about 50% from its highs reached in April and broke down from trendline support on Thursday. The relative strength index (RSI) fell back into oversold territory with a reading of 29.67, but the moving average convergence divergence (MACD) remains bearish. These indicators suggest that the stock could see some near-term consolidation before resuming its downtrend.

Traders should watch for some consolidation below trendline resistance at $11 per share before a resumed move lower. If the stock breaks down from support at $10.50, traders could see a move to fresh lows. If the stock rebounds from support, traders should watch for a move to retest trendline resistance at $11.00 or the 50-day moving average at around $13.00, near another trendline resistance level.

The author holds no position in the stock(s) mentioned except through passively managed index funds.