As if Twitter's stock didn't have enough problems, it now faces one more worry on the charts—a "death cross."
Shares of the social media giant are down nearly 30 percent since it reported disappointing quarterly sales on April 28. That plunge has implications for its technicals. Specifically, Twitter's 50-day moving average has crossed below its 200-day moving average. Technicians refer to that bearish pattern as a "death cross," indicating short-term momentum has moved to the downside relative to longer-term momentum.
According to options expert Dan Nathan, a death cross can serve as a signal for a stock's next move.
"Sometimes this works very well," Nathan, co-founder of RiskReversal.com, said on "Options Action." "I used it in January in Tesla and the stock dropped 15 percent. And I used it back in the fall in Google and the stock dropped 13 percent."
With Twitter's large price swings, this move has happened before since the company went public in November 2013.