Technical Analysis – Intel: A break above 31.27 is key for short-term momentum
January 26, 2023 11:30 am
Intel stock settled yesterday at 29.64, just below the recent high of 31.27. It has been a brutal 18-month period for the stock until the bulls finally managed to stage strong support at the 24.63-25.29 area during the fourth quarter of 2022. These levels are the basis for the formed double bottom pattern that appears to be affecting the price action.
Historically, this type of structure is considered a significant reversal pattern, but prone to false breakouts. The key level remains the “confirmation price” of 31.27 as a close above it could potentially encourage the bulls to take over the market reins. The pattern’s calculated target comes at the 38 level, but only 66% of this pattern type manage to achieve their full target.
The bulls need potentially more than just a double bottom structure, and the momentum indicators are not painting a rosy picture for them. The RSI seems to support the bullish intentions, but the recent lower high is concerning. The Average Directional Movement Index (ADX) is ready to signal a trendless market and the Stochastic has returned to its overbought territory. It can hover around this area for a while, but its intentions are unclear at the moment.
Should the bulls decide to take control of the market the initial target could come at the 31.16-31.27 range, set by the November 15 high and 23.6% Fibonacci retracement level of the March 30, 2022 – October 11, 2022 downtrend. Higher, the 200day simple moving average (SMA) at 34.18 could trouble the bulls, ahead of the busier 35.2-35.48 area, populated by the 38.2% Fibonacci retracement and the July 5 low.
On the other side, the bears could target the 50- and 100-day SMAs at the 28.19-28.53 range. If successfully broken, their eyes could be set at the December 22 low of 25.29 and, more importantly, at the October 11 low of 24.63.
Putting everything together, the bulls are trying to stage a comeback, but need a daily close above 31.27.
Intel stock settled yesterday at 29.64, just below the recent high of 31.27. It has been a brutal 18-month period for the stock until the bulls finally managed to stage strong support at the 24.63-25.29 area during the fourth quarter of 2022. These levels are the basis for the formed double bottom pattern that appears to be affecting the price action.
Historically, this type of structure is considered a significant reversal pattern, but prone to false breakouts. The key level remains the “confirmation price” of 31.27 as a close above it could potentially encourage the bulls to take over the market reins. The pattern’s calculated target comes at the 38 level, but only 66% of this pattern type manage to achieve their full target.
The bulls need potentially more than just a double bottom structure, and the momentum indicators are not painting a rosy picture for them. The RSI seems to support the bullish intentions, but the recent lower high is concerning. The Average Directional Movement Index (ADX) is ready to signal a trendless market and the Stochastic has returned to its overbought territory. It can hover around this area for a while, but its intentions are unclear at the moment.
Should the bulls decide to take control of the market the initial target could come at the 31.16-31.27 range, set by the November 15 high and 23.6% Fibonacci retracement level of the March 30, 2022 – October 11, 2022 downtrend. Higher, the 200day simple moving average (SMA) at 34.18 could trouble the bulls, ahead of the busier 35.2-35.48 area, populated by the 38.2% Fibonacci retracement and the July 5 low.
On the other side, the bears could target the 50- and 100-day SMAs at the 28.19-28.53 range. If successfully broken, their eyes could be set at the December 22 low of 25.29 and, more importantly, at the October 11 low of 24.63.
Putting everything together, the bulls are trying to stage a comeback, but need a daily close above 31.27.
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