Adobe shares have continued to fall after breaking down from a triangle pattern. The move is described as a fifth-wave decline, with price nearing a 240 target based on the triangle measurement.
A possible stabilisation area is near 240, but no low is confirmed. A durable low would need an impulsive rebound, possibly moving back above 311.
Further downside is still possible, including a retest of 205, which is the 2019 low. This places the 205–230 range as a key support zone for the year.
On a higher-timeframe view, wave C is described as being in its later stages. This suggests the corrective cycle may be approaching an end within the 205–230 support region.
We are seeing a familiar pattern in Adobe, reminding us of the selloff we monitored through 2025. That wave five decline ultimately found support in the 205-230 zone, which proved to be a critical floor for the stock. Now, with the stock’s recent weakness, these levels are again becoming highly relevant for our strategy.
The recent wobble in price is not without reason, as Adobe’s latest earnings report from late February 2026 showed weaker-than-expected forward guidance. This comes as a new industry report shows a slight erosion in their creative suite market share for the first time in two years, attributed to aggressive AI-native competitors. These fundamental pressures give credibility to a potential retest of older support levels.
Given the bearish momentum, traders should consider buying put options to hedge or speculate on further downside. Look at April and May 2026 expirations to allow time for the move to develop. Strike prices around the 240 level could offer a good balance of risk and reward, as this was the initial target from the previous triangle breakdown.
We must remain vigilant for signs of a bottom, and the key signal has not changed since last year’s analysis. A strong, impulsive move back above the 311 resistance level would be the first indication that a durable low is in place. Until such a move occurs, any rallies should be viewed with skepticism and potentially as opportunities to initiate bearish positions.
Considering the potential for sharp moves, implied volatility on Adobe options has ticked up to a 90-day high of 42%. To manage the higher premium costs, traders could use bear put spreads, for example, buying a May 250 put and selling a May 230 put. This strategy defines the risk and still captures a significant part of the expected downward move towards that critical support zone.
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