Trade of the Day – Super Micro Computer, Inc. (NASDAQ: SMCI) November 3, 2023 177

Trade of the Day

Super Micro Computer, Inc. (NASDAQ: SMCI)

(Current Price: US$245.90) – TECHNICAL SELL

Sell stop: US$227.30     Stop loss: US$254.00 (-11.75%)  

Take profit 1: US$193.00 (+15.09%)     Take profit 2: US$168.00 (+26.09%)    

 

 

(1): Super Micro Computer, Inc. has been forming a series of lower highs and lower lows in the right shoulder portion of a head & shoulders formation, which provides a bearish signal

 

(2): This is supported with decreasing momentum recorded on both Moving Average Convergence Divergence (MACD) & Relative Strength Index (RSI) technical indicators

 

(3) & (4): The price could break down of the head & shoulders formation should it fail to hold the confluence of a neckline support and horizontal swing low support in September

 

In that case, the price could potentially retest the first support level at US$193 which was the intraday low in May following a gap up

 

It could then head towards the next support level at US$168, which was a previous horizontal resistance and fill a price gap formed in May

Expected timeline of the trade is 2-12 weeks from the date of report issuance

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About the author

Profile photo of Zane Aw

Zane Aw
Technical Analyst
PSR

I analyze the stock market and conduct technical analysis to provide investment recommendations. I look forward to having a conversation with you in our in-house seminars and presentations to identify good risk-reward trading strategies together. I graduated from Nanyang Technological University with a Bachelor of Accountancy (Honours).

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