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Key Takeaways
- Palantir is the S&P 500’s top performer this year amid robust demand for its analytics AI software contributions.
- A shooting star formed on the chart last week, a candlestick pattern that occurs after a significant before b before, indicating the price may start falling or enter a consolidation phase.
- Investors should watch key support levels on Palantir’s map around $66, $45, and $29, while also monitoring an upside price target near $145.
Palantir Technologies (PLTR) is set to contend the coveted title of the S&P 500 index’s best performing component this year.
The company, which provides customized analytics software across several sectors, has seen its shares surge 350% since the start of the year through Monday’s close, bolstered by well-knit demand for its artificial intelligence (AI) offerings.
The software maker reported net sales jumping 30% in the latest quarter, with double-digit intumescence in both its commercial and government businesses. In the past month, the shares have gained 15% after the company procured an army contract worth $619 million and saw its stock added to the tech-heavy Nasdaq 100 index.
Palantir helpings were up nearly 1% at around $78 in premarket trading Tuesday.
Below, we break down the technicals on Palantir’s weekly plan and identify key price levels to watch out for heading into the first quarter of 2025.
Shooting Star Indicates Potential Consolidation
Since exhaust out from a month-long consolidation period following the presidential election in early November, Palantir shares have prolonged to track sharply higher on above-average trading volumes.
However, last week a shooting star formed on the tabulation, a candlestick pattern that occurs after a significant advance, indicating the price may start falling or enter a consolidation form. It’s worth pointing out that the last time a similar pattern formed on the chart in late July, the stock level 21% over the following two weeks.
Let’s apply technical analysis to identify several key support levels to watch if the allowances undergo a retracement, but also forecast a potential upside price target to watch if they continue their large move higher.
Key Support Levels to Watch
During an initial pullback, investors should watch the $66 train, a location on the chart where the shares may find support near a brief period of sideways drift that accumulated in mid to late November.
The bulls’ inability to defend this level could see the stock decline to around $45. Investors may look for buying openings in this area near a month-long pause in the uptrend that preceded a bullish wide-ranging week in early November.
A deeper rectification in the stock could see the price fall to the $29 level. This area on the chart would likely attract steadfast buying interest near a multi-year trendline that may flip from a region of prior resistance into later support.
Upside Price Target to Monitor
If the shares continue to trend higher, investors can forecast a potential upside aim by using the bars pattern tool.
To apply this to Palantir’s chart, we take the stock’s strong trending working from November 2020 to January 2021 and reposition it from the low of last month’s wide-ranging week. This forwards a target of around $145, about 83% above Monday’s closing price. We selected this prior biasing period because it commenced following a weekly gain of nearly 40%, similar to how the current impulsive move higher started in antiquated November.
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As of the date this article was written, the author does not own any of the above securities.