DoorDash Plummets 3.89% as Reddit Scandal Sparks Investor Exodus – What’s Next?

Summary
• DASH plunges 3.89% to $215.38, breaching intraday low of $212.51
• Viral Reddit post falsely accuses DoorDash of unethical practices, triggering CEO Tony Xu’s swift denial
• Options chain shows aggressive bearish positioning with 2026-01-16 $220 call options trading at 75.11% leverage

DoorDash’s stock is in freefall after a viral Reddit post falsely alleged internal misconduct, sparking a sharp intraday selloff. The company’s CEO and Uber Eats executives have denied the claims, but the damage to sentiment is evident. With the stock trading below its 200-day moving average and key support levels under pressure, traders are scrambling to assess the fallout from the AI-fueled misinformation crisis.

Reddit Scandal Unravels DoorDash’s Narrative
The selloff was catalyzed by a fabricated Reddit post claiming DoorDash used a 'Desperation Score' to exploit drivers, a claim swiftly debunked by CEO Tony Xu. The post, which included AI-generated documents and a fake employee badge, triggered a wave of short-term panic. Despite Xu’s emphatic denial and Uber Eats COO Andrew Macdonald calling the claims 'completely made up,' the market reacted to the reputational risk. The incident highlights the vulnerability of high-growth tech stocks to AI-driven misinformation, with DASH’s 96.42x dynamic P/E ratio amplifying volatility.

Food Delivery Sector Reels as Uber Trails DoorDash in Sell-Off
The food delivery sector mirrored DASH’s decline, with Uber (UBER) down 2.68% as investors extended the sell-off to sector peers. However, DASH’s drop was more severe, reflecting its higher valuation multiple and greater exposure to sentiment swings. The sector’s underperformance underscores investor caution ahead of DoorDash’s Q4 2025 earnings on February 18, with the recent Serve Robotics partnership now under scrutiny for its impact on utilization rates.

Bearish Playbook: Leverage 2026-01-16 Options Amid Volatility Surge
• 200-day MA: 227.92 (below) • RSI: 52.82 (neutral) • MACD: 1.38 (bearish crossover) • Bollinger Bands: 219.11–237.23 (breach of lower band)

The technicals signal a breakdown in DASH’s structure, with the stock trading below its 200-day MA and RSI hovering near oversold territory. The 2026-01-16 $220 call option (DASH20260116C220) and $225 call (DASH20260116C225) offer aggressive bearish exposure. Both contracts exhibit high leverage (75.11% and 151.81%) and elevated implied volatility (36.43% and 35.74%), reflecting market anticipation of further downside. The $220 call’s 0.3695 delta and $225 call’s 0.2220 delta position them to benefit from a 5% price drop to $204.61, with projected payoffs of $15.39 and $20.39 per contract, respectively.

• DASH20260116C220: Call, $220 strike, 2026-01-16 expiry, IV 36.43%, leverage 75.11%, delta 0.3695, theta -0.6764, gamma 0.0325, turnover 149,009
• DASH20260116C225: Call, $225 strike, 2026-01-16 expiry, IV 35.74%, leverage 151.81%, delta 0.2220, theta -0.4554, gamma 0.0261, turnover 16,623

The $220 call’s high turnover and moderate delta make it ideal for capitalizing on a short-term breakdown, while the $225 call’s elevated leverage suits aggressive traders. Both contracts benefit from high gamma (0.0325 and 0.0261), ensuring sensitivity to price swings. With the Tradr 2X Long DASH ETF (DASX) down 6.78%, leveraged players should monitor the 200-day MA as a critical support level. If $219.11 breaks, DASH20260116P200 puts offer short-side potential.

Backtest Doordash Stock Performance
The DASH ETF has demonstrated resilience following a -4% intraday plunge from 2022 to the present. The backtest shows a 3-day win rate of 59.68%, a 10-day win rate of 59.29%, and a 30-day win rate of 67.98%, indicating a higher probability of positive returns in the short term after the intraday plunge. The maximum return during the backtest period was 12.55% over 30 days, suggesting that DASH has the potential for recovery and even exceed pre-plunge levels.

Act Now: DASH’s 200-Day MA Breakdown Signals High-Risk Opportunity
The selloff in DASH reflects a confluence of AI-driven misinformation and structural technical weakness. With the stock trading below its 200-day MA and key support levels under pressure, the near-term outlook remains bearish. Investors should prioritize short-term options like DASH20260116C220 and DASH20260116C225 for leveraged exposure to the downside. The sector leader, Uber (UBER), is also down 2.68%, signaling broader sector fragility. Watch for a breakdown below $219.11 or a regulatory response to the Reddit incident to confirm the trend. For aggressive traders, the 2026-01-16 options chain offers a high-risk, high-reward setup as the market digests the fallout from the AI-fueled scandal.