Key Takeaways
- Supermicro shares jumped 12% on Wednesday after the server maker submitted its delayed financial reports just ahead of a deadline yesterday to avoid being delisted by the Nasdaq.
- While the stock had logged four consecutive losing trading sessions leading into the filing deadline, it found support on Tuesday around the key 50% Fibonacci retracement level.
- Investors should monitor key overhead areas on Supermicro’s chart around $63, $75, and $96, while also watching major support levels near $48 and $38.
Super Micro Computer (SMCI) shares soared Wednesday after the server maker submitted its delayed financial reports just ahead of a deadline to avoid being delisted by the Nasdaq.
The company said in a statement that the Nasdaq confirmed its compliance with the exchange’s filing requirements, and that “the matter is now closed,” helping ease investors concerns in recent days that it might not meet the Feb. 25 cutoff date.
Supermicro shares have lost more than 40% of their value over the past 12 months amid accounting and corporate governance allegations that contributed to the company’s delayed regulatory filings. However, the stock has surged 68% since the start of the year, boosted in part by a business update earlier this month that provided an upbeat revenue outlook, driven by growing demand for its products to support AI infrastructure.
Below, we break down the technicals on Supermicro’s chart and point out key price levels that investors may be eyeing.
50% Fibonacci Retracement Level Provides Support
Supermicro shares trended sharply higher on increasing volume for several weeks after breaking out from a falling wedge pattern before running into selling pressure just above the closely watched 200-day moving average.
While the stock had logged four consecutive down days leading into yesterday’s filing deadline, it found support on Tuesday around the key 50% Fibonacci retracement level when applying the tool from this month’s low to high, setting the stage for today’s surge higher.
Let’s identify three key overhead areas on Supermicro’s chart where the shares may encounter resistance and also identify major support levels worth watching during potential retracements.
Key Overhead Areas to Monitor
Supermicro shares rose 12% to close Wednesday’s session at around $51. The stock was down 5% in recent after-hours trading.
The first overhead area to monitor sits around $63. The shares may face selling pressure in this region near the August countertrend peak, which closely aligns with this month’s high.
A close above this area could see the shares climb to the $75 level. Investors who have accumulated shares at lower prices may look to lock in profits at this location near a trendline that links the February pullback low with a series of troughs that formed on the chart between April and June.
Buying above this level may propel a move to around $96, an area on the chart where the shares could encounter resistance near multiple peaks that developed from February to July just below the stock’s all-time high.
Major Support Levels Worth Watching
During retracements, investors should initially watch the $48 area, a region just above the 50% Fibonacci retracement level where the shares may find from a trendline that connects a range of comparable price action on the chart from August to December.
Finally, a deeper pullback could see the shares revisit lower support around $38. Investors may seek entry points in this location near the prominent September swing low, the late October gap day’s high, and the January peak.
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