Palantir Knocks On Resistance Again: Can It Bust Through?

Palantir Technologies Inc. PLTR has been a frustrating stock for many traders over the past few months, because despite its popularity on Robinhood and in the Fintwit communities, the stock has traded sideways since Feb. 23 despite releasing heaps of news.

On June 10, $576,204 worth of call contracts were purchased by institutions who believe the price of Palantir is about to go higher, with one options trader betting over $90,000 its stock could reach $35 by November.

Palantir’s stock has spent the past 11 days forming a strong base below resistance and looks ready to break out.

See Also: How to Buy Palantir Stock Right Now

The Palantir Chart: Palantir reached its all-time high of $45 on Jan. 27 before entering into a downtrend where the stock made fairly consistent lower highs and lower lows. On May 11, Palantir found a bottom at $17.06 and shot up after reporting better-than-expected first-quarter earnings. Since finding its new low, the stock has risen 46% up toward a resistance level at $25.30 but decreasing volume on the daily chart has made it difficult for Palantir to bust through that level.

On Monday morning, Palantir made its second attempt, after trying on June 8, to pop over that heavy resistance level but wicked off it.

There is an overhead gap on Palantir’s chart just above a support and resistance level at $30.44 and, because gaps fill 90% of the time, it's likely Palantir’s stock will eventually trade back up at that level.

Palantir is trading above both the eight-day exponential moving average (EMA) and the 21-day EMA with the eight-day EMA trending over top of the 21-day EMA, all of which are bullish indicators. Palantir is also trading above the 50-day simple moving average (SMA), which indicates there's bullish sentiment in the stock. The 200-day SMA is not available as an indicator for Palantir because it has not yet been trading for 200 trading days.

Bulls want to see big bullish volume help Palantir break up over resistance at $25.30 and make a run at the $27.47 area. If it can regain $27.47 as support, it has room to move up toward the $30 level and fill the overhead gap.

Bears want to see Palantir continue to reject the $25 level and fall back down to retest support at $21.04. If Palantir’s stock was to lose the level of support, it could fall back down toward $17.54.

PLTR Price Action: Shares of Palantir were trading around $24.81 at publication time.