Why Palantir Shares Could Soar Over This Key Level

On Thursday, it was announced Palantir Technologies Inc PLTR had partnered with global consulting firm AlixPartners “to unlock and accelerate their clients’ use of data to drive outsized results.” The partnership will combine Palantir’s operational AI Foundry platform with AlixPartners consultancy services to assist a variety of enterprises with complex and critical challenges of analysis.

Palantir is set to print its third-quarter earnings on Tuesday morning. When the company printed its second-quarter earnings beat on Aug. 12, the stock gapped up over 9%. Palantir expects third-quarter revenue to come in at $385 million compared to the consensus estimate of $376.4 million.

See Also: How to Buy Palantir Stock

The Palantir Chart: Palantir hit a bottom at the $23.02 level on Oct. 4 and reversed course into an uptrend, making consistently higher highs and higher lows on the daily chart. Palantir’s most previous high low was printed on Wednesday at the $25.17 mark and the most previous higher high sits at $26.75.

Palantir has reached $26.75 on two occasions and if the stock is unable to bust up through the level over the coming days it may create a bearish double, or even triple, top pattern. Bulls will want to watch for Palantir to cross above the key level on high volume for confirmation the uptrend is still intact. If Palantir can climb above the level, it could make a big bullish break higher, however, earnings are always a risk.

The stock has a gap above between $30.30 and $31.26, which was left behind on Feb. 16 following a bearish reaction to its fourth-quarter 2020 earnings print. Gaps fill about 90% of the time so it is likely Palantir will trade back up into the range in the future.

Palantir is trading above the eight-day and 21-day exponential moving averages (EMAs), with the eight-day EMA trending above the 21-day, both of which are bullish indicators. The stock is also trading above the 50-day simple moving average, which indicates long-term sentiment is bullish.

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• Bulls want to see big bullish volume come in and push Palantir up to make a higher high and towards a resistance level at $27.47. If the stock can regain the levels as support, it has room to trade back up toward $29.19.
• Bears want to see Palantir reject the $26.75 level and then for big bearish volume to come in and drop the stock down below $25.17 to negate the uptrend. Below the level, the stock has support at $24.13.