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Oracle Stock Down 52% in Two Months: Reddit Debates Whether $119 Is a Floor or a Trap

Oracle stock has plunged 52% from its May peak, sparking intense debate on Reddit about whether $119 is a support level or just a pause before further declines. Meanwhile, a Motley Fool analysis highlights the company's massive debt and dependence on OpenAI.

  1. Oracle stock has fallen 52% from its May high to $119, a key technical support level discussed on r/smallstreetbets.

  2. A r/ValueInvesting post highlights ORCL as one of many 'AI stocks' down significantly from their highs, questioning whether the S&P 500's resilience masks a broader downturn.

  3. A Motley Fool analysis warns of Oracle's $130 billion debt and reliance on OpenAI, which is burning cash and has delayed its IPO.

The $119 Question

Oracle stock has been one of the hardest-hit names in the recent tech sell-off. After peaking near $249 in late May,

ORCL
$ORCL has plunged to around $119, a 52% decline in roughly two months. On Reddit, the stock is a hot topic, with traders debating whether this is a buying opportunity or a value trap.

A post on r/smallstreetbets zeroed in on the $119 level, describing it as a critical support on the weekly chart. The author noted pre-market activity showing 92,000 shares moving with a +3.23% push to $123.90, suggesting some buyers are stepping in. Options data pointed to resistance in the $138–$140 range if the support holds. But the tone was cautious: 'The bear case is that $119 is just a parking spot before lower lows.'

ORCL

A Broader Market Concern

On r/ValueInvesting, a post with 219 comments argued that the S&P 500's modest 2.5% decline from its all-time high masks a much more severe rout in individual stocks, especially those tied to AI. The author listed

ORCL
$ORCL alongside other major names like
NVDA
$NVDA,
TSLA
$TSLA, and
SMCI
$SMCI as examples of stocks that have dropped 16% to 51% from their highs. The post questioned whether investors are ignoring a hidden downturn, a sentiment that resonates with Oracle's steep decline.

The Debt and OpenAI Risk

Same-day news from The Motley Fool added a fundamental layer to the discussion. The analysis noted that while Oracle's revenue grew 21% and its backlog stands at a massive $638 billion, the company has taken on nearly $130 billion in debt—a 300% debt-to-equity ratio—to build AI data centers. More concerning, roughly $300 billion of that backlog depends on a single customer: OpenAI. The article pointed out that OpenAI is burning cash, with $21 billion in losses against $13 billion in sales, and has delayed its IPO, raising questions about its ability to pay Oracle.

This concentration risk is a key reason why some Reddit users are wary. As one commenter on r/smallstreetbets put it, the stock's decline may not be over if the AI spending cycle falters.

New Trading Instruments

In a separate development, a post on r/wallstreetbets highlighted that CME Group launched Single Stock Futures on July 27, covering

ORCL
$ORCL among dozens of other stocks. These new instruments allow traders to bet on Oracle's price direction with leverage, potentially adding volatility to an already turbulent stock.

Oracle's sentiment score on Tendie.bot is 0.144, indicating a mildly positive tilt despite the bearish price action. The stock ranks 14th in overall discussion volume, with 10 posts and 436 comments. The debate on Reddit remains unresolved: is $119 a floor, or just another stop on the way down?

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