[ Jump to the 2024-11-10 update ]
Squeezed into a small, converging space between its weekly MA support and resistance bands for multiple weeks, SMCI, Super Micro Computer’s stock, had a big move brewing.
In our October 19th post, Super Micro Computer, a Storyboard, we wrote:
…this is a tight spot that can launch SMCI to either direction. A break below the support band may be brutal. A break above resistance may be brutal as well, for short sellers.
A week passed and Super Micro Computer’s stock could still not break below its support band nor above its 8-week EMA, although SMCI tingled its resistance:
The space between the support and resistance bands narrowed even more. Last week, on Wednesday’s news, market participants sent SMCI down viciously through the support band:
Previously, when SMCI broke below its weekly support band in July of 2024, it has done it fiercely. As a result, the stock’s value got slashed in half:
The pattern seems to repeat itself. As of the close of the last weekly trading session, the stock’s value is approaching another slash in half:
Where’s the next support level?
A current MA calculation puts it at around $20:
SMCI’s 372-week EMA (body) support line is @ $20.43 and its 366-week EMA (wick) support line is @ $20.68:
SMCI may find some rest there. We’ll keep watching.
2024-11-10 Update
In the week that passed since the publication of the above post, SMCI hit both marks:
- The stock’s value got slashed in half again (and a bit more) since it broke below the weekly MA support band.
- Price reached the new support band and bounced off of it.
Zooming in:
