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ZS

AVOID

Zscaler, Inc.

Mixed signals — conservative read

Gap Down
-6.5%
TechnologyEPS Sep 3, 2026

Price Chart

Range
ZS · DailyEMA 12EMA 26EMA 50EMA 200

Gap-Down Information

Prev Close
$177.80
Open
$166.16
Gap %
-6.5%
Close
$173.75
Day High
$174.86
Day Low
$165.06
Volume
1.72M
Vol vs 50d Avg
0.7x

Score Analysis

Model 1: De-Rat Score (HIGH = solid selloff = avoid)

Composite42/ 100
Gap Quality (30%)34
Volume Quality (25%)55
Earnings Quality (25%)36
Technical Context (20%)45

Model 2: Bounce Probability (HIGH = dip-buy)

P(bounce)51%20d horizon
Tier:LOW
Expected 20d Return+2.0%
Trained on 563 gap-downs across 142 tickers (2y backtest). Distance from SMA50 (mean reversion) is the strongest predictor; wide gap-day range = capitulation washout.
  • Extended above SMA50 (10%): gap-down = trend breakdown — 43% bounce rate

Verdict & Playbook

AVOIDMixed signals — conservative read
Dip-Buy Entry Ref
$173.75
Stop (gap-day low)
$165.06
vs SMA 200
Above
SMA 50
$161.04
SMA 200
$172.47
EMA 10
$177.67

Analysis

ZS gapped down 6.5% (0.68× average volume). De-Rat Score: 42/100 — weak/overshoot selloff. P(bounce): 51% [LOW] — expected +2% over 20 trading days. Key signals: Extended above SMA50 (10%): gap-down = trend breakdown — 43% bounce rate. EPS surprise of 11.0% (beat).

Analyzed by derat-v1+bounce-v1 · Sep 4, 2026

Outcome Tracking

1d Return
-6.8%
5d Return
+10.3%
20d Return
+16.1%

Post-Gap Validation — 5-Day Follow-Through

✅ Reversal (DIP-BUY)
Confidence69%
Days Tracked5/5
Reversal Score59.0
Selloff Score35.0
Recovery
100%
Vol Decay
-82%
Further Downside
-8.4%
Max Recovery
+11.7%
Peak Close
Day 5

Day-by-Day Price Action

DayCloseHighLowVolume
Day 1$161.94$165.62$159.204.14M
Day 2$166.10$169.10$161.153.27M
Day 3$163.48$169.05$162.062.87M
Day 4$164.54$165.95$160.752.06M
Day 5$191.73$194.12$170.067.56M

Signal Breakdown

  • Recovery100.0% recovered
    Price climbed back 100% of the down-gap — mean-reversion in play
    reversal
  • Volume-82% decay
    Volume sustained — only -82% decline suggests continued distribution
    selloff
  • Price TrajectoryPeak close: Day 5
    Higher lows with recovery into late week — dip-buyers stepping in
    reversal
  • Further Downside8.4%
    Sank another 8.4% from gap close — falling knife
    selloff
  • Fundamental QualityEPS surprise 11.0%
    Positive earnings signal despite the gap-down — reaction may be oversold
    reversal