Key takeaways
- Intel shares rose again on Tuesday after surging more than 12% last week as investors upped the ante following a strategic update and rumors of a pending deal.
- A bullish engulfing pattern has formed on the chart near the early September low, setting the stage for a potential double bottom.
- Investors should follow crucial overhead levels on Intel’s chart around $25, $30, and $37, while also tracking a key support level near $19.
Shares of Intel (INTC) rose again on Tuesday after surging more than 12% last week as investors upped the ante following a strategy update and rumors of a deal in the works .
Last Tuesday, the troubled chipmaker announced plans to spin off its venture capital fund into a standalone entity while remaining an investor in a bid to improve the company’s efficiency. Later in the week, sentiment rose further after a report emerged that the company could be a takeover target.
Shares of Intel were up 2.5% to around $22 as of early Tuesday afternoon. Despite the recent rebound, the stock has lost more than half its value over the past 12 months due to investor skepticism about the company’s ability to capture a larger share of the booming computer chip market. artificial intelligence (AI).
Below, we detail technical data from Intel’s weekly chart and highlight crucial price levels worth watching.
Bullish engulfing pattern indicates possible double bottom
Intel shares saw an impressive reversal last week to form an engulfing uptrend, a two-bar candlestick formation that signals a positive change in investor sentiment. It is important to note that the pattern formed around the same spot on the chart as the early September low, setting the stage for a potential double bottom.
Additionally, last week’s rally occurred on the highest weekly volume since early December, indicating buying conviction among major market participants, such as institutional investors and hedge funds.
Let’s identify three general areas that investors could watch if the chipmaker’s stock rises and also highlight a key support level to watch if the stock gives back last week’s gains.
Crucial general areas to follow
Further buying could initially see shares rise to around $25. This area of the chart could offer resistance near the October 2022 and February 2023 lows, which also align closely with the November 2024 high.
A decisive close above this zone could see shares rise to the $30 mark. Investors could look for exit points here, near a trendline that connects a range of comparable highs and lows on the chart from September 2022 to June of last year. This region also roughly aligns with the 50% Fibonacci retracement level when extending a grid from the December 2023 high to the September 2024 low.
More bullish price action could propel a rise to around $37, a place where shares could see selling pressure near the closely watched 200-day moving average and a horizontal line that connects a series of levels comparable trading prices on the chart between June 2022. and July last year.
Key support level to follow
Finally, the bulls’ inability to defend their recent gains could cause shares to return to significant lows around $19. Investors looking for bottoms could look for buying opportunities around the important lows in September and January.
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