How Long Can Micron’s Bounce Last?
Micron Technology bounced along with the rest of the market over the last week. But now it may be showing signs of continuing lower.
The main pattern on today’s chart is the falling trendline along the highs of August and September. While MU has fought above this resistance, trendline breakouts have generally not worked in the current bearish market. Fundamentals are also a challenge as memory-chip demand weakens.
Next you have a grouping of candlesticks: a spinning top on Tuesday, an outside day on Wednesday and an inside day on Thursday. Those could mark a top for the recent bounce.
Third, stochastics have reached an overbought condition.
Finally, the longer-term chart shows little evidence of a bottom. MU’s next likely support zones on the weekly timeframe could be the August 2020 low around $42.25 or the longer-term base around $34:
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This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
The main pattern on today’s chart is the falling trendline along the highs of August and September. While MU has fought above this resistance, trendline breakouts have generally not worked in the current bearish market. Fundamentals are also a challenge as memory-chip demand weakens.
Next you have a grouping of candlesticks: a spinning top on Tuesday, an outside day on Wednesday and an inside day on Thursday. Those could mark a top for the recent bounce.
Third, stochastics have reached an overbought condition.
Finally, the longer-term chart shows little evidence of a bottom. MU’s next likely support zones on the weekly timeframe could be the August 2020 low around $42.25 or the longer-term base around $34:
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Important Information
TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. You Can Trade, Inc. is also a wholly owned subsidiary of TradeStation Group, Inc., operating under its own brand and trademarks. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.
This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
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