CrowdStrike Outage Explained | Is The Stock a Buy

We're diving into one of the hottest topics in the tech world—the massive CrowdStrike outage. With its stock plummeting, many are wondering if it's the right time to buy at a discount. Let’s dissect what happened and what it means for potential investors.

CrowdStrike, ticker symbol CRWD, is a renowned cybersecurity firm that provides security solutions to numerous organizations worldwide, especially those using Microsoft computers. A recent update pushed by CrowdStrike to these devices proved disastrous, causing what’s commonly known as the "blue screen of death." This left countless Microsoft computers unusable, crippling operations globally.

Airlines like Delta were perhaps the most visibly affected, but the impact was widespread, hitting hospitals, banks, and even police stations. In light of this, let's delve into the specifics.

The issue became so serious that congress stepped in, calling for CrowdStrike’s CEO to testify. This isn’t just a formality. It raises tough questions: Why does CrowdStrike have such significant control over so many devices? Were there sufficient checks and balances before deploying the update? Could this have been a targeted attack against CrowdStrike itself?

The involvement of congress indicates the severity of the situation. When lawmakers start questioning a company's operations, it can have a long-lasting impact on both public trust and stock performance.

If you're pondering over CrowdStrike's stock as a potential investment in light of its recent drop, let's look at the numbers. Before the incident, CrowdStrike was already struggling to break the $400 barrier. The stock had resistance at around $390 for quite some time. The critical point came when the bugged update was released; the stock plummeted and found very little support.

My analysis suggests looking at the $240 level for potential support, but confidence is low, given the magnitude of the incident. The stock slicing through previous support lines on high volume indicates severe market distrust.

Considering all these factors, my advice is to stay on the sidelines for now. We need answers from the congressional testimony, and we must see how CrowdStrike moves forward in restoring trust. Any hints that the company was hacked and didn't disclose it could spell further disaster.

In summary, this is a trying time for CrowdStrike and its investors. While some may see a buying opportunity in the current discounted stock price, the unresolved questions and potential liabilities make this a high-risk venture. Until more clarity is provided—particularly through congressional hearings—it's wise to exercise caution.

Are you trading CrowdStrike or thinking of getting in? Let me know your thoughts and strategy.

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[00:00:00] CrowdStrike stock drops after cybersecurity outage.

[00:00:35] Intro to CrowdStrike, who they are, and what happened.

[00:03:44] CrowdStrike CEO called to testify over outage.

[00:08:17] Potential congressional involvement and doubts about CrowdStrike.

[00:10:40] Doubts about technological lab's approval and testing.