PLTR Drops 10% – A Temporary Correction or Trend Reversal?

 Technical Analysis of Palantir Technologies (PLTR) – February 2025

Palantir Technologies Inc. (PLTR) has recently experienced a significant correction, dropping 10.08% to $112.06. This decline follows a strong rally that has propelled the stock upwards since the beginning of the year. In this article, we analyze the stock’s technical indicators to understand the current market sentiment and possible future movements.

Price Action and Key Levels

PLTR reached a high of $125.41 before facing selling pressure and pulling back. The strong bullish trend that was previously in play now appears to be encountering resistance, with $120 serving as a key psychological level. On the downside, $108 could act as an immediate support zone, while a further breakdown could test levels around $85-$90, where previous consolidation occurred.

Momentum Indicators: Stochastic RSI & MACD

• Stochastic RSI (3,3,14) is currently showing a reading of 78.46, indicating that the stock was recently in the overbought zone and is now retracing. However, the %K line is crossing downward, which could suggest continued selling pressure in the short term.

• MACD (12,26,9) remains in positive territory, but the histogram shows signs of declining momentum. The MACD line (blue) is still above the signal line (orange), but if this trend reverses, it could signal a potential shift in trend.

Volume Analysis

The volume spike accompanying this price drop suggests that traders are actively taking profits after a strong uptrend. If selling volume remains elevated, it could indicate further downside risk. However, a bounce from key support levels with strong buying volume may signal a resumption of the uptrend.

Market Sentiment and External Factors

• Broader Market Influence: The overall market movement, particularly the performance of major indices such as the Dow Jones (-0.31%), S&P 500 (+0.1%), and Nasdaq (+0.1%), may impact PLTR’s next move.

• Bond Yields: The U.S. 2-year Treasury yield (-0.44%) is also something to watch, as it reflects expectations for Federal Reserve policy changes. Higher interest rates could put pressure on high-growth tech stocks like PLTR.

• Upcoming Events: Investors should also consider macroeconomic factors such as inflation reports and Federal Reserve meetings, which may influence overall market sentiment.

Final Thoughts

While PLTR remains in a broader uptrend, short-term technical signals suggest a period of consolidation or potential further downside before the next move. Traders and investors should monitor key support and resistance levels, along with volume trends, to gauge whether the stock is finding new buying interest or if further correction is likely.

*Disclaimer: This article is for informational purposes only and does not constitute financial advice.