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Palantir shares moved lower in premarket trading on Wednesday after falling sharply yesterday, as the stock continued to retreat from its all-time high set in late December.
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The recent sell-off comes after investment bank Morgan Stanley initiated coverage of the stock with an “underweight” rating and reports emerged that ARK Investment Management Cathy Wood's technology funds had sold shares in the company.
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The stock broke down from a rising wedge in late December and has recently found renewed selling pressure on a retest of the pattern's lower trendline.
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Investors should watch critical support levels on the Palantir chart around $66. $59, and $45, while also monitoring a major resistance area near $81.
Shares in Palantir Technologies (PLTR) down in premarket trading Wednesday after falling sharply yesterday, as the stock continues to retreat from its record high installed at the end of December.
A recent sell-off in the shares comes after investment bank Morgan Stanley initiated coverage on the stock earlier this week with “under pressure” rating and reports emerged that Cathie Wood's ARK Investment Management technology fund has sold shares in the company.
The analytics software provider had a stellar 2024, finishing the year as the S&P 500's best performing stock. Its shares more than quadrupled, boosted by growing demand for its suit of artificial intelligence (AI) software products.
Palantir shares were down 2% at around $68.50 in recent premarket trading, after falling nearly 8% on Tuesday. By yesterday's close, the stock was down 18% from its all-time high on December 24.
Below, we take a closer look at Palantir's chart and apply technical analysis to identify key price levels worth watching for.
Palantir shares broke down oa lifting wedge in late December before retesting the lower trend line of the pattern earlier this month. However, since then the stock has faced renewed selling pressure, though trading volumes remain clueless.
Meanwhile, the relative strength index (RSI) confirms weakening price momentum, falling below the key 50 threshold for the first time since early August last year.
Let's identify three critical ones support levels where the shares may encounter buying interest amid further selling and also identify principal resistance area to watch during possible progress.
First, investors should monitor how the stock reacts to the $66 level. This position on the chart finds a trifecta of support from mid-November peakthe 50 day moving averageand the 38.2% nearby Fibonacci donkey level when applying a grid from late October low to December high.