Palantir Stock Price Levels to Watch After Post-Earnings Surge

Palantir (PLTR) shares traded sharply higher in extended trading on Monday after the analytics software provider topped third-quarter estimates and lifted its full-year revenue outlook amid robust demand for its artificial intelligence (AI) offerings.

In particular, the company pointed out AI demand from government and commercial customers, adding that it expects the rapid adoption of its platforms and AI capabilities to drive future growth. Palantir shares have gained more than two-fold since the start of the year as of Monday’s close, boosted in part by the stock’s recent inclusion into the large cap S&P 500 index.

Palantir shares gained 14% to $47.09 in after-hours trading Monday.

Below, we analyze the technicals on Palantir’s chart and identify important post-earnings price levels to watch out for.

Broadening Formation Breakout

Since breaking out above a flag pattern in early September, Palantir shares trended sharply higher for about a month before consolidating within a broadening formation.

Leading into the company’s quarterly results, sellers moved into the stock, but bulls successfully defended the formation’s lower trendline, with trading volume registering its highest level since early October on Monday.

Amid the stock’s projected earnings-driven breakout above the broadening formation on Tuesday, let’s identify several key overhead levels investors may be watching and point out an important zone of support to monitor during periods of profit-taking.

Key Overhead Levels to Watch

The first sits around $45. Although the stock sits poised to open above this level on Tuesday, it’s worth watching for a close above this price located near the stock’s all-time high (ATH) and the broadening formation’s top trendline.

To project an overhead price target above the stock’s ATH, we can use a bars pattern, a chart technique that uses prior price action to predict future moves. In this case, we take Palantir’s trending move from September to October and overlay it from the broadening formation’s lower trendline, which forecasts a target of around $60.

We selected this prior trend as it commences from the lower trendline of a consolidation pattern—the flag—and included a double-digit percentage jump early in the move, potentially rhyming with how an earnings-driven rally in the stock may play out.

Important Zone of Support to Monitor

During periods of profit-taking, investors should keep a close eye on a zone of support between $41 and $38, where the stock may attract buying interest from the broadening formation’s lower trendline and the September peak.

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As of the date this article was written, the author does not own any of the above securities.