PLTR’s technical analysis clearly shows that buyers are in control of the price movement.
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Palantir Technologies (NYSE:PLTR), a Colorado-based provider of data analytics and security services, was briefly out of favor with stock traders. However, sentiment has turned, and we can use PLTR’s technical analysis to prove it. If you’re a momentum-focused investor, you should really consider buying Palantir stock.
Palantir Technologies recently announced a deal with Microsoft (NASDAQ:MSFT), which will see Microsoft integrate some of Palantir’s products into its Azure cloud computing services for public sector customers. In addition, Palantir reported impressive results for the second quarter of 2024, including revenue of $678 million, beating Wall Street’s forecast of $653 million.
These developments gave Palantir stock a huge boost. Now let’s see what the charts tell us about the tug-of-war between buyers and sellers.
After the upturn, buyers struck
Sometimes stock charts can be messy and frustrating. However, the following daily candlestick chart for PLTR stock is clean and perfect.
It doesn’t get any better than this – at least not if you’re optimistic. As you can see, Palantir stock has bounced right off the 200-day moving average (the black line), which is a long-term trend indicator.
Additionally, PLTR stock is above the 50-day moving average (purple line), a medium-term trend indicator, as well as above the 20-day moving average (blue line), a short-term trend indicator.
Moreover, the lines are in the right order for the bulls: the 20-day average is at the top, the 50-day average is in the middle, and the 200-day average is at the bottom. Buyers of Palantir shares are undoubtedly the winners!
Don’t get greedy with Palantir shares
On the other hand, buyers of PLTR stock cannot afford to be complacent. If the stock becomes extremely overbought, it will be time to think about an exit strategy.
The Relative Strength Index, or RSI, is an indicator that can help you decide when to take profits. When the RSI rises well above 70 in this daily Palantir stock candlestick chart, the stock is overbought and it makes sense to sell your shares.
At the time of writing, the RSI was around 65, not yet in the overbought danger zone. Even if it is close to 70, that is not too overbought. However, if the RSI rises to the mid-70s or higher, PLTR stock is vulnerable to a pullback, so keep a close eye on the RSI in the coming days.
PLTR Technical Analysis: Bulls Remain in Control
Palantir Technologies reported strong financial results and announced a deal with Microsoft. This news helped buyers of Palantir stock take the reins.
However, PLTR’s technical analysis shows that bulls need to keep an eye on the charts and be ready to take profits. For now, however, it’s OK to buy a few Palantir shares and ride the momentum to higher prices.
On the day of publication, David Mnadel had (neither directly nor indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com’s publishing policies.
At the time of publication, the editor in charge did not hold any positions (either directly or indirectly) in the securities mentioned in this article.
