Palantir Technologies (PLTR) shares fell 10% on Wednesday, and again dropped 5.2% on Thursday after a report stated that the Trump administration has directed the Pentagon to make sizable cuts to the US defense budget.
The move could negatively affect military contractors like Palantir, which earns over 40% of its fourth-quarter revenue from the US government. Despite two days of selling, Palantir shares are still up nearly 40% since the start of the year and have soared 350% in the past year.
Investors should monitor support levels around $100, $85, and $66 on Palantir’s chart. The company recently extended a contract with the US Army and has been boosted by expectations that its AI-powered analytics software could help improve government efficiency under the Trump Administration.
A bearish engulfing pattern was formed on Wednesday, indicating a shift in momentum. The price target for Palantir shares using the bars pattern tool is around $170 if the stock resumes its uptrend. However, investors should be cautious as continued selling could see the shares test the psychological $100 level or drop to $66.
The company’s recent performance has been boosted by investor sentiment, but a more significant correction may trigger a drop to these levels. The technical analysis suggests that Palantir shares are due for a correction after a period of sustained growth.
Source: https://www.investopedia.com/watch-these-palantir-price-levels-after-stock-retreats-from-record-high-update-11683198