First Watch plunges 5.76% in pre-market trading due to broader market volatility and algorithmic trading.

First Watch plunged 5.76% in pre-market trading on Dec. 22, 2025, signaling a sharp reversal in investor sentiment ahead of the bell. The selloff marked one of the steepest intraday declines in its recent trading history.

Analysts noted the drop coincided with broader market volatility linked to shifting interest rate expectations, though no company-specific catalysts were immediately identified. The move underscored lingering uncertainties in the retail sector amid macroeconomic headwinds.

With no material earnings or strategic updates reported in the prior week, the decline appeared driven by algorithmic trading patterns and sector-wide profit-taking. Institutional investors have maintained a neutral stance on the stock, with open interest in derivatives contracts showing minimal directional bias.

Market participants are now closely monitoring near-term catalysts, including upcoming earnings and broader macroeconomic data, to determine whether this selloff is a temporary correction or a more significant bearish shift. Technical analysts have drawn attention to the key support and resistance levels currently in play, as traders prepare for potential follow-through selling or a rebound into the close.