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Palantir’s stock will likely be in the spotlight on Monday after the Nasdaq announced late Friday that the analytics software provider had been added to the Nasdaq 100 Index.
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The stock continued to rise sharply after breaking out of the cup-and-handle pattern, although the relative strength index warns of overbought conditions that could lead to price swings in the short term.
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The measurement principle, which calculates the percentage change of the cup and the handle “cup” and adds them to the pattern’s highest trendline value, projects a bullish price target of $140.07.
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Investors should look for key lower levels on Palantir’s chart at $45 and a support zone between $33 and $29.
Palantir Technologies (PLTR) shares will likely be in the spotlight Monday after the Nasdaq announced late Friday that the analytics software provider is teaming up with MicroStrategy (MSTR), and Axon Enterprise (AXON), was added to the Nasdaq 100 Index.
The stock’s inclusion in the tech-heavy benchmark comes after it more than quadrupled year-to-date as of Friday’s close, boosted by growing demand for the software maker’s customizable artificial intelligence (AI) offerings. The company’s shares became eligible for inclusion in the index following a strategic switch from the New York Stock Exchange (NYSE) to the Nasdaq last month.
Below, we provide an overview of the technical data on Palantir’s weekly chart and identify the key price levels that investors may be paying attention to.
Since breaking out of a multi-year cup-and-handle pattern in August, Palantir shares have continued to rise sharply. Trading volumes have supported the increase, indicating buying participation from larger market participants.
The relative strength index (RSI) confirms the bullish momentum, although the indicator’s elevated value above 80 warns of overbought conditions, which could lead to price swings in the short term.
Let’s apply technical analysis to project a longer-term bullish price target, while also pointing out key support levels that could generate buying interest during retracements.
To predict a potential bullish price target, investors can use the measuring principle, a chart-based technique that analyzes the cup and handle pattern to predict a future move.
When we apply the method to Palantir’s chart, we calculate the percentage change of the cup and the “cup” of the handle and add it to the top trendline value of the pattern. For example, we add a 383% upside to $29, which equates to a target of $140.07, about 85% above Palantir’s closing price on Friday.
