Takeaways
- Intel shares rose 10% in extended trading on Wednesday after the company announced that former board member Lip-Bu Tan, a chip industry veteran, was its new CEO.
- Since the stock’s sharp drop in early August of last year, it has remained largely rangebound, possibly carving out a bottom for the market.
- Investors should watch crucial overhead areas on Intel's chart around $22, $26, and $30, while also monitoring a major support level near $19.
Intel (INTC), shares surged in extended trading on Wednesday after the company appointed former board member Lip-Bu Tan, a chip industry veteran, as its new CEO.
Tan, the former CEO Cadence Design Systems, a chip software company, will succeed interim co-CEOs David Zinsner (who has been sharing the position with Michelle Johnston Holthaus since Pat Gelsinger’s retirement in December). Tan will take over the role next Tuesday.
The development follows a report earlier Wednesday that Taiwan Semiconductor Manufacturing Company (TSM) has approached Nvidia (NVDA), Advanced Micro Devices (AMD) and Broadcom (AVGO) about forming a joint venture to own and run Intel’s foundry division — a unit that manufactures chips for third party customers.
Intel shares have lost over half their value in the past year, due to the company’s failure to capture a larger share of the lucrative AI chips market and months of restructuring rumors and deal rumours. Stocks jumped 10% in Wednesday’s after-hours session to $22.84. This was due to the news of the CEO’s appointment.
Below, we analyze the technicals of Intel’s chart to identify key price levels that investors might be watching.
Potential Rangebound Bottom
Intel shares have mostly remained rangebound since the sharp drop in early August last, possibly carving out a bottom for the market.
The stock has recently staged a short lived rally to the closely watched 200-day moving (MA) before retracing back towards its trading floor from the past seven month.
The shares have risen in Wednesday’s regular session and look set to gain further on Thursday.
We’ll identify three key overhead areas on Intel’s chart to monitor amid the potential of a new trend upwards. We’ll also identify a significant support level that’s worth monitoring if stock retraces back to multi-month lows.
Important Overhead Areas To Watch
The first area of interest is around $22. While the stock’s projected opening price is above this level, it’s still worth checking if bulls will be able to hold onto this level until tomorrow’s closing, given that this line is close to a horizontal dividing line linking a range of similar trading action from August last to March this.
A successful close above the level could see shares rallying to the $26 range. Investors looking to lock in profits may want to look at the recent peaks of November and March.
Buying above the region could push the price to around $30. This area would likely act as resistance near the psychological round figure and the low from a previous trading range that preceded early-August’s gap lower.
Major Support Level Worth Monitoring
Intel’s price could drop to a multi-month low of $19 if it continues to sell shares. Bargain-hunters may want to buy shares near the trendline that connects several troughs of the stock between August & February.
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