Shares rose more than 6% on Monday
Key points
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Intel shares rose to a two-month high on Monday as analysts said the company will benefit from growing interest in AI-powered personal computers and other technology-related hardware trends.
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Intel’s stock price has broken above the upper trendline of a narrow trading range on the highest volume since June 21, indicating bullish conviction behind the move.
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Amid further upside, Intel shares could find resistance at $35.50, $39, $42 and $45.50.
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Short-term overbought conditions could push the stock price back to the upper trendline of the previous trading range around $32, which has now likely turned from an area of ​​resistance to support.
Intel (INTC) Apple shares rose more than 6% to a two-month high on Monday as analysts at Melius Research said the chipmaker stands to benefit from rising interest in artificial intelligence (AI)-powered personal computers and other technology-related hardware trends. The stock was the biggest gainer on the Nasdaq 100 and Dow Jones Industrial Average on Monday.
Below, we take a closer look at Intel’s chart and use technical analysis to point out key levels to watch in the upcoming trading sessions.
Breakout from a narrow trading range
Even though the 50-day moving average (MA) crossed below the 200-day MA to form an ominous death cross in early May, Intel shares have traded within a tight range with several volume spikes since that time.
On Monday, the chipmaker’s shares broke above the upper trendline of the trading range on the highest trading volume since June 21, indicating bullish conviction behind the breakout. Moreover, the relative strength index (RSI) has moved into overbought territory above the 70 thresholds, confirming strong price momentum.
Monitor these chart levels amid increased strength
Amid a continued bullish move, investors should monitor these four key levels where the stock may encounter overhead resistance.
The first area to watch is around $35.50, an area on the chart that connects prices near a small counter-trend retracement during the stock’s sharp downtrend move in April.
If the stock breaks above this level, it could rise to retest a key horizontal line near $39 that links the prominent September 2023 high with the 200-day MA.
A close above this region could send the stock up to around $42, where it would likely face sellers near a trendline connecting four price lows between December 2023 and March of this year.
Finally, a longer-term rally could see the price revisit $45.50 near a horizontal line connecting several price peaks over a five-month period from November to April.
Short-term overbought conditions
While the overbought RSI reading confirms strong price momentum, it also increases the chances of a short-term pullback or gap completion.
During temporary pullbacks, investors should keep an eye on the upper trendline of the previous trading range around $32, which has now likely turned from a resistance area into a support area.
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