Talking Numbers

Bid on eBay?

Bid on eBay?

eBay shares fell hard in afterhours action Tuesday after the online auction house reported better than expected earnings and revenue for the first quarter, but lowered second quarter guidance.

(Read: )

The stock has been stuck in a ten-dollar wide range since late 2012 and is down about half a percent since the start of the year.

So is the selloff an opportunity to bid on the stock?

(Watch: Classic eBay quarter: Pro)

Richard Ross of Auerbach Grayson says if the chart is any indication, stay away.

"When it [consolidation] occurs at the tail end of a five year run that's seen the stock up six times from that low of $10 dollars per share, and we run into ten years of resistance, that tells me momentum has stalled and the risk is to the downside."

As always, Ross stressed the importance of the key moving averages. "Look at your hundred-week moving average and use that as your signal. A break below that level sets the stage for a fast move down."

(Check out: Learn about moving averages)

But John Stephenson, on the other hand, is a buyer of eBay and has three reasons for it: fast growth, emerging market opportunity and valuation.

Check out the video from today's CNBC "Street Signs" for more.


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